Special 'Tech Talks' episode: How does Data Extraction work for different teams in lending and borrower businesses?

Intro:  Hello, and welcome to another episode of The Ledger – the podcast dedicated to lending, finance and technology.

In this special bite size tech talks episode, Louise and Kristina from the Dancerace  team explain how Data Extraction works for borrowers and different teams within lending businesses.

It's perfect if you're a lender who's heard about open accounting or data extract and wants to know what it will mean for your work and your customers. We hope you find it useful!

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Kristina (Dancerace):   Welcome everyone to today's podcast.  By way of introduction, my name is Kristina. I'm a product specialist here at Dancerace. In this podcast, we're going to be talking about how Data Extraction works for different teams within lender and borrower businesses, and the day-to day value that it offers.

I've got Louisa here to help me with that. Louisa, can you tell us what you do at Dancerace?

Louisa (Dancerace):   Hi, Kristina. I look after the customer success at Dancerace and my background is working with lenders – so this gives me quite a unique perspective from both the lender side and the tech provider's side.

K:  Great. We're gonna start by explaining some of the different terms we'll be using in this podcast. Hopefully nothing too difficult. After that, we're going to talk about how borrowers and lenders use Data Extraction in the course of a typical funding relationship.

So Louisa, what are some of the key terms that we'll be talking about? Often these can be confusing for lenders.   

L:  So, the topics that we're going to run through are the Data Extraction technology, f3 Digital Onboarding, Insights and then in c3, we're going to talk a little about eSync.

K:  Okay, great. So let's start with the Data Extraction technology.

L:  Our Data Extraction product is powered by Codat. The product provides open accounting connectivity to borrowers' online and offline accounting packages, so it can add real value to both lenders and borrowers. This is because it allows you to pull real-time sales ledger information, financial information and management account information directly from those accounting packages.

This means the data is really high quality, accurate and up to date. This in turn reduces the effort required from lenders and helps them to manage their risk.

The value for borrowers is it really offers a much better borrower experience because there's no longer a need to collate lots of information – for example, to email over management accounts, profit and loss and balance sheets, and there's no need for them to upload big .CSV files into e3. This is all done automatically.

K:  That sounds like a blessing to me – if I look up a .CSV and there's a whole load of numbers, I immediately shut down. So, what about f3 Digital Onboarding?

L:  f3 Digital Onboarding is a Dancerace system that uses Data Extraction technology to enable lenders to offer an end-to-end onboarding process and to underwrite applications for funding much more efficiently and simply.

K:  Sounds ideal. What about the eSync facility in c3?

L:  So eSync is the in-life product within Dancerace's c3 Backoffice Control system.

eSync uses our eShadow functionality, supercharged with Data Extraction. It makes processing much, much easier. Lenders use bulk posting functionality for collections, but also have added risk management abilities because they can see the borrowers' open ledgers in the background – in the 'shadow' – just like you can with a factoring facility.

Again, this makes processing faster and simpler, and means that you can make on-the-spot risk decisions and not have to wait until month end to complete your manual eco, which you would do if you were running an ID bulk facility.

K:  Okay. Then tell me about Insights.

L:   Insights is available in both f3 Digital Onboarding and c3 Backoffice Control using eSync.

Insights captures all of the management, sales ledger and creditor information from a borrowers' accounting system, for lenders to review and use for decision-making.

The real value here of Insights is from the risk management side. It allows risk managers to access that data at any time that they require it and use it to make decisions on funding requirements to manage their clients' ongoing facility requirements.

K:  Now let's talk about how each of those elements are used in the funding life cycle, starting with borrowers.

For borrowers, it's a really simple, easy setup. They only need to connect their accounting package through either f3 Digital Onboarding or e3 Client Access once – either during the onboarding process or with an existing facility from a lender.

This means they no longer need to upload .CSV files to upload their ledger information. They no longer need to send over management information or creditors,  or provide remittances or allocation details. And if they're using our Xero writeback technology, there's no longer a requirement for them to key in their collections, payments or fees. Instead, e3 writes these transactions directly back to their Xero accounting system.

K:  Great – it definitely feels like we're working smarter, not harder. So how do lenders use the systems?

Thinking about this from a lender's perspective, there are a few different stages that they'll go through in the lifecycle of a prospect to a client.

If we start with the sales process, your sales manager or your business development managers will no longer need to manually collate management information and sales ledger information. Instead, it's all done automatically through the onboarding process and Data Extraction from the borrower's accounting system.

What that means from an underwriting perspective is that new business reports can be drawn up much quicker. There's no need to wait for missing or outstanding information. It's all there in one place in f3 Digital Onboarding.

This ensures a much quicker take-on process. With f3 Digital Onboarding, there's the option to create and define your own tasks, which can lead into take-on checklists. So there's no longer the need to run take-on checklists outside of the system. And you can use this to upload documents, add notes to the client, and even request new documents from the client.

Probably my favourite part about the take on-process with Data Extraction is the option to automatically transfer borrower data from f3 Digital Onboarding into c3 Backoffice Control, automatically creating your client database when you are ready to start funding your client.

So, when the take on process is completed, you then go into the relationship management and client management part of the process.

This is where the eSync facility comes into play. eSync allows relationship managers and client managers to spend more time doing what their job titles suggest, which is managing relationships and risk, making funding decisions and building relationships.

They're no longer bogged down with day-to-day tasks like cash allocations, processing schedules and dealing with allocation queries, which can all take up a lot of time. Instead, the system's going to take care of that for them.

When it comes to processing the ledgers, there's automatic processing within the system, which means that a ledger can be extracted from the borrower's accounting package and then automatically posted into c3 Backoffice Control without anybody having to click any buttons to get it there.

I mentioned a little about risk management a moment ago, and that's another key step in the lender's process where Insights really comes in. With insights, risk teams have access to that on-demand information that's been extracted from their client's accounting package. This includes management information, profit and loss balance sheets and their creditors for contras. This info is important for portfolio review meetings – especially if they're looking to make lending decisions or handling higher risk clients.

I've spoken quite a lot there about the different benefits, but in summary: borrowers spend much less time managing and uploading information and sending manual documents and emails. And lenders spend less time on admin and more time doing what they are the best at!

K:  Thanks, Louisa.

L:  Thanks Kristina.

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Outro:  We hope you found this week's episode useful. If you'd like to find out more about any of the systems or services covered, please email info@dancerace.com or if you already use our os, contact one of our support team who will be happy to help. Until next time, thanks for joining!

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