Page 25 - MTIA Summer 2022 Market Brief

Maybe You Can, But When Should You?

Making sure that digital solutions map well to real- world workflows requires
special consideration. For example, portals can deliver meaningful self-
service value when viewing a report or allowing a borrower to view all lenders
participating in a facility. How ever, in many instances, portals present stale data,
thereby introducing further reconciliation items that may have already been
resolved but have not yet appeared in the portal. Many of these factors
contribute to the low adoption of technologies such as portals within the
industry. In a sense, clients are trying to keep the portal up-to-speed, not the
other way around.

An Application Programming Interface (API) can help eliminate rework and reduce
human error by directly ingesting loan data, but data delivery time may still not
match an asset manager’s trading frequency. APIs typically push data to client
systems a limited number of times per day. Since an asset manager’s entire
loan portfolio requires information from multiple providers, dealing with various
portals and APIs may ultimately replicate the gaps of more manual data delivery
in digital form. Operations staff still have significant work to do to ingest and
reconcile.

Meeting the Needs of End Users: Closing the Gap

Technologies can only help close loan information gaps when tailored to the way
people want to use the data. Technologies in search of a solution have an even
harder time looking for real-world usage. Instead, data providers must work
to adapt both the data they provide and the way they provide it. Sometimes,
however, the limiting factor is habit rather than technology. The benefits are
compelling in theory, but the challenge is putting them into practice.

Neither behaviors nor technologies change overnight. Familiar ways of doing
things have a lot of staying power. While we see the loan markets on a long-
term trajectory to standardize around real-time data and shared industry-wide
conventions for reporting, it will take many years to get there.

Theory Practice
Self-service can streamline Loan agents still receive thousands of
searching, lookups, and ad emails per year for simple requests
hoc report creation. such as position confirmations.

Such communication is ripe for deeper electronification to support better,
mutually beneficial interaction between providers and stakeholders.

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