Reasons why your lending business should get API-field?

But what are APIs and why is there such a lot hype around them?

API stands for Application Programming Interface. they need been around for several years and have now turned more mainstream for his or her unique abilities.

In layman terms, APIs include a series of protocols that allow a software solution to turn functions from other sources and systems. In lending, APIs enable the lender to accumulate critical information that's essential for deciding .

Where do APIs sit within the lending sector?

When the number and quality of knowledge available with the lender is accurate and extensive, it turns into a competitive advantage for the borrower. However, the lender must be ready to gather that sort of data during a cost-effective and secure manner.

When the knowledge in hand is validated through relevant sources, deciding becomes easier, and therefore the lender is best positioned to assess loan requests from an entire array of consumers .

This is where, APIs join the game!

With the pandemic catalysing the necessity for digital lending and therefore the percentage of bad loans increasing, APIs are here to remain and become the longer term of efficient and safe lending!

How important is efficient loan decision making?

The RBI has reported a whopping Rs 660 thousand crores of bad loans for Indian banks since 2014.

A popular opinion behind the downfall of the 94-year long Lakshmi Vilas Bank is its unwarranted shift of focus to larger loans.

Clearly, bad loans can bring down any organization regardless of its legacy and calibre.

What benefits do APIs deliver for a lending organization?

APIs enable rapid deciding by providing data points from any third-party source including the Indian government.

APIs allow the lender to delve deeper into the metrics.

APIs don't store any data within them and are therefore 100% secure and safe.

The loan origination system is formed error-free through APIs, thus generating higher and better business for the borrower.

APIs economize , time and energy needed for loan processing.

Why does the lending sector need APIs?

Apart from above mentioned benefits of API, there are for compelling reasons for borrowers to embrace an API-driven structure. They are:

• Industry regulations.
• Competition from new entrants and fintech players.
• Increasing got to go digital.
• Paving way for newer revenue streams.

What are the APIs utilized in the loan origination process (LOS)?

The loan origination software includes multiple APIs which will be categorized as follows

• Identity verification: This includes APIs for PAN card, driver's license , voter ID, passport and AADHAR verification. Techniques like OCR are employed by the APIs and no customer data is stored in them at any point. Therefore, the privacy data remains unaffected.
• Address verification: Generally, two important checks are made under this category and that they are electricity bill validation and LPG verification.
• Vehicle verification: The RC number of a borrower is all that it takes for this verification, using which, certain personal details, like address, age and name of the owner are often identified easily. this sort of check also can be called asset verification.
• Financial verification: Financial data is tough to accumulate , are often complex and yet is vital to form a legitimate decision within the loan origination system. Tools like data scrapping and penny drop API are used for financial checks like checking account verification, statement analysis, ITR extraction and GST details (GST details also are collected for merchant verification). Again, the info is 100% secure during the method .
• Utilities API: Face crop API, Face match API, Name match API and Face Liveness are a number of the APIs utilized in this category.
• Digital contracting: When the loan has been approved the borrower must initiate the E-sign transaction. APIs are often used for this purpose too.
• OCR service: OCR stands for Optical Character Recognition. it's wont to convert text from images into machine-coded text. for instance , OCR API are often wont to read a scanned copy of a document and therefore the data obtained from the image are often repurposed to be used by the borrower.

A deeper check out the range of APIs available for the lending industry follows…

Identity Authentication

PAN Check

• Input Required – PAN number of the customer
• Output Delivered – Real-time verification of the PAN number
• Sources Used – Database from National Securities Depository Limited and therefore the tax Department.
• Benefits – Instant results. Real-time and thus the foremost recent changes are often captured.

Driver’s License (DL) Check

• Input Required – DL (Driving Licence) number
• Output Delivered – Verification of DL validity, Photo of licensee, Name & Address as per DL, Date of birth and Date of issue of DL, blood type , Name of father or husband, Category of Vehicles the licensee is permitted to drive along side the effective date.
• Sources Used – National Database for Driving Licenses and Vehicle Registration.
• Benefits – Instant, comprehensive.

OCR

• Input Required – Scanned image of any ID of the customer
• Output Delivered – Card holder’s name, Father or husband’s name, Date of birth, Face extraction, PAN number then on.
• Sources Used – Uses OCR technique to read vital information of the provided IDs.
• Benefits – Saves times, error-free.

Voter ID Check

• Input Required – Voter ID number
• Output Delivered – Authentication of the Voter ID number, Name of cardholder in English and regional language, Gender, Mobile Number and Email ID, Date of birth, Name of father or husband (in English and regional language), Complete address of cardholder (including district and state), Applicable polling, booth address, Applicable parliamentary constituency.
• Sources Used – National Portal of India/Electoral Databases.
• Benefits – Instant, comprehensive and helps identify identity fraud.

Passport Check

• Input Required – Passport number which is employed to get the MRZ code
• Output Delivered – First and surname as on the passport, Date of birth, Date of expiration of passport, sort of passport, Address and age of the passport holder.
• Benefits – Instant and comprehensive

Offline Aadhaar

• Input Required – Aadhar Number and XML file upload from UIDAI site
• Output Delivered – Output for the XML and PDF mode is nearly same except that the e-mail and phone details are going to be delivered only through XML mode. Name, DOB, Gender, Address, Image.
• Sources Used – Information is obtained from two Government approved sources: E- Aadhaar and Offline Aadhaar XML
• Benefits – Instant and comprehensive

Address Verification

Electricity Bill Validation

• Input Required – Consumer ID and Name of the Electricity Service Provider.
• Output Delivered – Registered address of the customer, Electricity bill date, Date, number, and amount of the newest bill, Pending amount against the newest bill, maturity of the newest bill, Email ID and telephone number , Information about payment arrears and deposit.
• Sources Used – Regional State Electricity Board or the Authorised Electricity Supply Company of the state.
• Benefits – Useful for address verification.

LPG Connection Verification

• Input Required – LPG Customer ID (obtained from the bill).
• Output Delivered – Name & Address of the buyer , Email ID and registered telephone number (last four digits), Registered Aadhar Number (last four digits), Name and Code of LPG Distributor, Consumer Number, Bank Details (Account number, bank name and IFSC code and branch details), Subsidy status of consumer, Number of subsidized refills consumed within the last year, Amount of subsidy availed, Total number of refills, go back the last generated bill.
• Benefits – Useful for address verification.

Asset Validation:

RC

• Input Required – RC number
• Output Delivered – Validation of the RC number (i.e. The given RC number is decided as valid or invalid using this API). The valid RC number yields the subsequent details about the vehicle. Body type, Chassis Number, Fuel type, Registered color, Gross weight, Name of manufacturer, Number of cylinders, Engine number, Model and make, Registered name of owner, Owner serial number.
• Sources Used – Vahan may be a nationwide search over the digitized data of Registered Vehicles
• Benefits – wont to validate basic details like ownership, permit then on for any vehicle (both commercial and private).

Financial Check :

GST Verification

• Input Required – GST Number
• Output Delivered – Legal name of the business, State jurisdiction/State jurisdiction code, Central jurisdiction, Registered name of the business or individual linked with the required GST Number, Taxpayer type, Business type (proprietorship/partnership/private limited, public company then on), Nature of business, Address and get in touch with information of the business, GST registration date and date of cancellation of registration, GSTIN last updated, brand name , Expenses incurred and revenue earned monthly, Client list, Tax payable.
• Sources Used – Central Board of Indirect Taxes and Customs (CBIC) are often wont to search a corporation employing a GST Number.
• Benefits – Useful for verification of commercial loan and real estate loan applications

Note: Alternatively, an API to verify the GST number alone is additionally available.

Bank Account Validation

• Input Required – checking account Number – IFSC Code of the corresponding bank
• Output Delivered – Status of the account- either valid or invalid, Name of the account holder, Bank Reference number, Amount wont to verify the status of bank (which is typically INR 1)
• Sources Used – Validation is completed through the penny drop mechanism.
• Benefits – checking account are often verified within seconds. are often integrated with mobile and web applications (rest API)

Bank Statement Analyser

• Input Required – OPTION 1: Uploading Bank Statements, OPTION 2: Using Net Banking Credentials.
• Output Delivered – Money Received / Paid Analysis, Total Debt/Credit in last 6 months, High Value Transaction Analysis, Average Monthly Balance, Average Monthly, Negative Balance, Benefit Cost Ratio Analysis, BTO Analysis, Frequent Transaction Analysis, Monthly Opening Balance Amount, Average Quarterly, Balance, Monthly mastercard Amount, Internal Transaction Analysis, Penalty Analysis, Negative Balance Analysis, Inward / Outward Cheque Return, Analysis, EMI / Interest / Dividend Transaction Analysis, Loan Payment Analysis, Salary Analysis, Minimum Balance Analysis, Cash Deposit Analysis, Investment Analysis,OD utilization Analysis, Credit Gap Analysis, Total Number of Overdrawn Period, Unusual Transaction Analysis, Interest Gap Analysis
• Sources Used – Uses Data Scrapping technique.
• Benefits – Fetch key financial data of customer

ITR Extraction

• Input Required – IT Number
• Output Delivered – PDF copy of ITR (based on the duration i.e. number of years that ITR details are needed), 26AS for mentioned duration, PAN number linked with the ITR, telephone number and DOB linked with the PAN number.
• Sources Used – tax portal
• Benefits – Fetches tax returns of the customer.

Useful for creating key decisions about the application .

Digital Contract Aadhar Sign (Aadhaar E sign)

• Input Required – API initiates the E sign transaction. Request for the signing of one (or multiple) PDF document is initiated by providing information about the document, places where the signature is required , purpose of the signature, name and city of the signer.
• Output Delivered – INIT – Signed URL of the PDF document (valid for 48 hours).
• Benefits – Helps to access customers from remote locations.

Credit Bureau API

• Input Required – Name of the individual or business.
• Output Delivered – Credit score for the business or individual.
• Sources Used – Registered credit agencies – CIBIL, CRIF High Mark, Experian & Equifax.
• Benefits – Instant results

Utilities API:

IFSC Verification

• Input Required – IFSC Code
• Output Delivered – the subsequent details concerning the IFSC code is delivered Bank name, Bank code, Branch Address (City, District, State), Contact number, RTGS status.
• Sources Used – Any Indian Bank
• Benefits – Useful for bank and account verification.

Face Match API

• Input Required – User Image
• Output Delivered – A face match score is generated and may be interpreted as follows,
  0 – Not Matched.
  1-75 – Unlikely.
  75-85 – Likely.
  >84 – Very likely.
• Sources Used – User image is compared with authorized documents submitted.
• Benefits – Helps serve customers in remote locations.

Face Extract API

• Input Required – User Image
• Output Delivered – Cropped face image of the customer.
• Sources Used – Delivers image by cropping face from a photograph.
• Benefits – Helps serve customers in remote locations.

Name Match

• Input Required – Name to be checked
• Output Delivered – Matching score for the first name .
• Sources Used – Other authorized documents that carry the name of the customer
• Benefits – Helps to match the name easily.

OCR API

• Input Required – Scanned image of any ID of the customer
• Output Delivered – Card holder’s name, Father or husband’s name, Date of birth, PAN number then on.
• Sources Used – Uses OCR technique to read vital information of the provided IDs.
• Benefits – Saves times, error-free.

Face Liveness

• Input Required – Presence of customer employing a camera
• Output Delivered – Face liveliness score
• Sources Used – The live features of the face are matched with the image obtained through documents like Voter ID, Aadhar or DL.
• Benefits – Prevents chances of fraud and is beneficial for patrons in remote location.

Mobile Number Validation

• Input Required – Mobile number of the customer.
• Output Delivered – Mobile number is decided if valid or invalid.
• Sources Used – Truecaller
• Benefits – Saves times, error-free.

Social media scoring

• Input Required – Name of the customer and Social media login
• Output Delivered – Social media score – obtained through digital footprint of the customer.
• Sources Used – Social media websites
• Benefits – Offers additional information about the customer.

SMS Reading Capabilities

• Input Required – Mobile number of customer.
• Output Delivered – Consent of customer to read their SMS.
• Sources Used – Consent obtained directly from customer.
• Benefits – Instant and useful for collection of key information

Email Validation

• Input Required – Email ID of customer.
• Output Delivered – Email ID is decided if valid or invalid.
• Benefits – Saves times, error-free.

Video KYC

• Input Required – Includes three steps,
  1. Capture and validation of ID documents – Scanned copy of documents needed.
  2. Capture and verification of video activity – A live video session must be arranged between the customer and therefore the lending entity.
  3. Face compare – Scanned ID documents and live video session needed.
• Output Delivered –
  1. The ID document is validated and ensured that it's the proper format. Tampering detection.
  2. Verification of the document with the help of the source of ID document generation (optional).
  3. Generates the link for video capture
  4. Performs three important checks – Face liveness check, face consistency check and video activity check.
  5. Results obtained from the API include a video link, face snapshot, video activity details, video activity check, timestamp and geostamp.
  6. Face compare result.
  7. Document visual authenticity check.
• Benefits – Real-time screening, Fraud detection.

The Final Word

Get API-fied with Intelligrow Bancsoft!

• APIs are just like the superpower needed by any lending organization.

  
  

• Incorporated with all the above APIs, is that the robust digital loan origination software solution, Intelligrow Bancsoft, from Habile Technologies.

  
  

• This signature product addresses three main issues that banks and other lenders face while getting into the digital mode.




• Intelligrow Bancsoft integrates easily into legacy systems thus bringing down the value , time and energy needed for the digital transition.

  
  

• As the APIs used within the merchandise don't store any data within them, there are not any security issues.




• The lending industry is evolving. the answer is additionally set to grow and embrace more and more APIs thus ensuring that the user stays updated with technology and operational efficiency.




• In a nutshell, if API is that the fuel to your lending business, then Intelligrow Bancsoft is that the powerful engine which will deliver the simplest essence of the APIs.