The Power and Efficiency of Centralized Lending

Financial institutions that want to evaluate the efficiency and cost-effectiveness of their lending processes often employ a third party to conduct a process improvement study. Through process improvement, an institution can improve work flow, segment expenses and uncover pockets of profit. Generally, a bank should give selected credit authority-in small amounts-to the branches, often through the use of a credit scoring system. The key to consistent lending and a set amount of credit authority to the branches is the establishment of a credit scoring system. A credit scoring system gives each branch's loan officer the same consistent lending criteria. And it saves money on high-salaried loan officers and credit training.