Making the jump from manual Word and PDF business credit application templates to digital credit applications can seem like a big leap at first glance. But the reality is that making the switch is often easier than many businesses assume. Any amount of time put into evaluating new systems and getting set up within a digital platform can be more than made up for with the long-term time savings that these solutions provide, let alone a better customer experience, improved accuracy, and more.
Still, many businesses are hesitant to move on from Word and PDF business credit application templates (often referred to as paper-based, even if no physical paper changes hands). If the current system works, why fix it? Well, the current manual system may not be working as well as you think.
As a whole, manual business processes tend to pale in comparison to digital ones, especially in the credit space.
“Manual and paper-based underwriting practices lack consistency, auditability, and accuracy, and are above all, time consuming. Automation can allow for the streamlining of disparate systems, provide reliable and consistent dataflow for any stage of the loan origination process and quicken the overall process, while delivering solid audit and control benefits,” says Moody’s Analytics.
More specifically, in terms of business credit applications, Word and PDF business credit application templates tend to cause workflow issues for companies and their customers alike.
“The process of manual and paper credit applications is cumbersome and antiquated,” says Alex Armitage, CEO and founder of Nectarine Credit. For example, “the fields in PDFs are invariably locked, which requires additional emailing. Typing text in fields of Word Docs moves lines down so any text below the first few fields invariably gets out of order, disorganized and hard to read.”
But it doesn’t have to be this way. In this guide, we’ll walk through some of the most important steps in switching from manual to digital credit applications.
The first step in making the switch to digital is taking an earnest look at the inefficiencies in your current credit process. Review examples of business credit applications you’ve completed recently and make note of what could have gone smoother.
For example, maybe you had to call a bank to verify a customer’s account. The bank might have taken days or weeks to get back to you. Or maybe the bank didn’t even respond to your request. Even if they did so in a timely manner, perhaps they provided limited information, like saying the buyer has a balance of "high five figures" or "low-to-medium six figures.” When extending credit, however, that range might not be good enough. The more accurate and specific the information, the better.
Once you have a sense of any pain points, you can evaluate digital credit application platforms to see which ones align well with your needs. It’s a lot easier to make the switch if you know going in what you hope to accomplish with a new platform. Not only can you view product descriptions to find the right system overall, but you can also ask specific questions that allow you to get up and running quickly.
For example, you might notice that with paper-based processes, you’re having trouble keeping track of where all your applications stand. If you’re managing, say, 10-25 applications through Word and PDF business credit application templates per month, that’s a lot to handle via email and local file storage.
You might make mistakes like forgetting that you need to follow up on a customer request or vendor reference form. Or you may overlook that a credit application wasn’t signed, which negates any legal standing you may have had with a signed credit application.
With a platform like Nectarine Credit, however, you can easily track the status of all your applications through a cloud-based dashboard.
When evaluating platforms, also consider asking for examples of business credit applications to get a sense of how the system’s standard setup aligns with how you typically work. You may find that there’s not as big of a gap as you might have imagined, meaning it could be easy to quickly start using the platform. Or, if there are a few differences, see what it would be like/if it’s possible to customize credit application template fields the way you want.
After looking at some examples of business credit applications from digital platforms and narrowing down what you’re hoping to get out of a solution, it’s time to identify your onboarding needs.
“This all depends on the team,” explains Nectarine Credit’s Armitage. “At small teams, it's usually just the CFO. On medium-sized teams, typically the CFO and a credit analyst and maybe any additional accountant need to get onboarded. On large teams, it will be the CFO, multiple credit analysts, accounts receivable accountants, sales reps and other accountants.”
To properly onboard, you’ll need to ensure that the right personnel have access to the digital credit application system by having them create profiles on the platform. You’ll also want to make sure they’re comfortable using the platform and buy into the benefits that these systems can provide, such as accuracy and efficiency.
Nectarine Credit, for example, provides automated vendor reference checks and bank account verification. To get the most out of these features, you want to make sure that all users know how to tap into these benefits.
“In the case of the bank verifications, we have what's called a permission-based system. The buyer connects to Chase, BofA, Wells Fargo or one of the other 10,000 banks we're connected to, and we get bank verifications in seconds,” explains Armitage. “Along with verification, we also get bank balance checks going back six months, average transaction amount, cash inflows and outflows, bank address, currency and account type, e.g., checking/savings/line of credit.”
Switching from Word and PDF business credit application templates to digital systems can be relatively straightforward while providing many benefits. Having a sense of what inefficiencies you want to solve for, comparing digital credit application platforms, and figuring out your onboarding needs can make this migration even easier.
A key aspect of determining these areas depends on demoing digital credit application platforms to see what they look like and gain a deeper understanding of the advantages of switching. After a short demo of the Nectarine Credit platform and asking us a few questions specific to your use-case, users almost always get the hang of the platform and start benefiting from the digital benefits right away.
Ready to see how Nectarine Credit can help you improve your credit application process?