SourceOne Financial Services Inc., a Herndon, Va.-based organization that delivers financial services to consumers, is using an image loan-processing system to improve customer service and loan-processing efficiency for banks and other loanproviding organizations.

Developed by GTE Vantage Solutions, Chantilly, Va., the system incorporates credit evaluation, imaging and workflow functions, and the ability to go on-line with credit bureaus and other data bases, for issuing preapprovals over the phone.

Process Described

The imaging element is what makes the system unique, said Pierre A. Escandar, SourceOne president. The company has virtually eliminated paper from the loan-processing procedure. Instead of shunting paper files to different departments for processing, the company creates electronic files of loan applications, and processes the images.

This is distinctly different from the way imaging is used in loan processing, said Mr. Escandar. "Normally in banking environments, after a loan has been processed with paper, and either approved or denied, then the information is imaged for archiving purposes, at the end of the pipeline," he explained. "We incorporate imaging as an integral part of the origination process."

When customers call the company's 800 number to apply for a loan, they are connected to call center representatives in Herudon. They ask a series of questions and enter the information.

During the conversation, the system automatically is connected to a credit bureau, which runs a credit check. By the end of the conversation, the application and credit information is scored and analyzed, and the system pre-approves or rejects the loan. The process takes from five to 10 minutes, said Mr. Escandar.

Paperwork Scanned In

After applications have been pre-approved, the information that was entered is printed and sent to the customer for verification and a signature. When the application is returucd with any additional information, the documents are scanned into the system, and the application is moved through the approval process electronically.

Loan officers access the images, and are able to perform such functions as credit analysis, data entry, and auditing simultaneously. There's no longer a need to move paper files

With paper processing, they were auditing loans in June that were disbursed in March, Mr. Escandar said; now a loan can be audited the same day it is processed.

Customer service has also improved, he said. Customers calling to inquire about their applications can get answers in minutes instead of days.

Marketing Tool As Well

In addition, a workflow feature serves as a cross-selling tool. Based on key criteria, such as annual income, applicants are targeted as potential customers for other products and services.

"The capabilities of technologies such as imaging, workflow, relational database management, and telecommunications are highly relevant to many critical tasks in financial services," said Catherine B. Dunlevy, chairman of SourceOne, "including capturing and storing data, categorizing applications and accessing remote data sources."

She added that the combination of GTE's technology and SourceOne's financial expertise will enable the company to "add significant value to a number of financial service providers."

SourceOne has one major customer, which makes consumer loans used to buy educational equipment, such as computers SourceOne plans to provide the service to banks and other financial institutions

Remote Loan Officer

SourceOne and GTE have also combined their expertise on: the development of transaction kiosks. "With the ability to process credit approvals on-line, the next logical step is to process applications that are coming from a variety of sources," said Mr. Escandar.

GTE is developing prototype transaction kiosks where customers can go to get loan pre-approvals and other financial services. According to Thomas J. Magazzine, president of GTE Vantage Solutions, the kiosks will enable customers to interact with bank representatives through videoconferencing, and will include other technologies, such as imaging, fax, and interactive compact disk.

The kiosks will be able electronically to capture customer information such as signatures and identification, so that transactions can be completed in one session.

Mr. Escandar said that banks would benefit from the kiosks by being able to offer transaction services from many locations without the need for a live agent at each site. "The bank representative as a resource could be leveraged across a state, rather than in one location," he said.

The most likely places for the kiosks will be student centers and financial aid offices on campuses, human resources departments of corporations, bank lobbies, and malls, said Mr. Escandar. Testing of the kiosks will begin in the first quarter of 1995, he said.

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