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Technology Update : Interfacing with Funders
Written by Alex Stephen, Chief Executive of icenet Limited for Consumer Credit, CCTA magazine
Put simply, the principal of an EFI is to transfer data from one system such as icenet, to a remote system, electronically. This way of working is being adopted by brokers sending out multiple applications to finance companies in order to secure timely underwriting decisions for their dealer network.
As the market becomes increasingly competitive, brokers are using a larger and ever changing bank of finance companies for underwriting their deals and therefore require a fast and efficient means of working in order to retain and grow their market share and profitability.
With EFI technology, the information is submitted in XML standard format, which is used for transferring data between 2 remote systems. The data is then processed using icenet’s funder decision engine, a key component of the software. The funder decision engine allows rules to be defined against each finance company in order to ensure the deal has every chance of being accepted, first time. For example, a finance company that did not accept deals over £10k, would not feature on a list of suitable funders.
Specifically, there are 2 types of EFI’s, which type is usually dictated by the finance company:
One Way Interface – Data is keyed into icenet by the broker and the data is sent electronically to the finance company. The decision on the finance is then given by either fax or phone or by the broker accessing the finance company’s system via the internet.
Two Way Interface – This differs from a one way interface by following an automatic workflow process at the finance company, which usually involves credit reference checking and generating a credit score. When this is completed, the deal is usually either automatically accepted or declined and the decision is sent back electronically to the broker without any human involvement. This process will usually take between 1-2 minutes and where the deal is referred to an underwriter for a decision, up to 15 minutes. When the decision is received, the status is then automatically updated in icenet on the funder proposal.The benefits of using an EFI over the more traditional paper/fax based routes are clear:
Reduced time
Reduced paper/admin costs
Increased response time
Reduced errors
Increased accountability through paper trail
The overriding benefit to funders, broker and dealers alike is the ability to make more commission for more sales resulting in increased profitability.
In terms of the future of EFI’s, the Dealer Point of Sale solution is a further additional element in the system which can be deployed in order to achieve a process which involves the provision of paperwork, that the broker can print off from icenet (avoiding using a second remote system) and can pass electronically to the dealer for the end customer to sign.
Whilst there are many deals done using EFI’s, a true Two way EFI receives and stores the final completed documents of the deal in the brokers system rather by separate e-mail or paper copies, to complete the full picture.