Credit reports are familiar to many in the financial services, banking, and lending sectors because they are one of the most critical documents they deal with on a daily basis. Credit reports provide detailed transaction histories of credit card holders; therefore, managing credit reports requires caution because the analysis of the credit report leads to decisions such as the lending company of the borrower’s credit report.
In our digital age, most industries rely on advanced technology such as Artificial Intelligence (AI). But, is AI the most effective way to manage credit reports? Or is manual operation still effective? We will discover it in this article to identify the best method to manage credit report for business.
Credit Report Definition
A credit report is a detailed statement of an individual’s credit card activities, including transaction history, credit status, and loan repayment history. Lenders and banks typically use these reports to decide whether to offer rates and loans to borrowers. Some companies used credit reports to promote things such as TV cable subscriptions, insurance, mortgages, and more. Moreover, if the customer wants to continue using the credit card, these reports can assist lenders in deciding whether to extend or terminate credit.
Key information contained in a credit report
- Personal Information: Includes name, address, date of birth, employment details, and social security number.
- Credit Account Details: includes details regarding the date of account opening, account balance, payment history, credit limit, and credit history.
- Public Records: Contains information on tax liens, bankruptcies, civil lawsuits, and judgments.
- Credit Inquiries: Lists individuals or organizations that have accessed your credit report.
Manually vs Automated Managing Credit Report For Business
There are two types of credit report management, including manual and automated. Let’s break down the difference between manual and automated.
- Time Spent
Manually processing credit reports involves inputting transaction data and other information into the system one by one. This task can take hours, and for companies handling large volumes of paper documents, it might even take days.
In contrast, using tools is as simple as scanning physical documents or digital credit reports into dashboard tools, and AI will extract the information from credit reports quickly. It takes minutes or even seconds to complete one document. If the company has a large number of documents, it will take hours rather than days to process them manually.
- Accuracy
Manual processing requires multiple checks to ensure the data is accurate, as human input is prone to errors. This repetitive validation can be time-consuming and still leave room for mistakes.
When leveraging automation, AI tools will extract data not only faster but also with greater accuracy. Employees do not need to double-check each entry because the data is processed reliably. Even if employees want to review the results, tools like Fintelite allow them to review and adjust reading results to improve accuracy. Make it more adaptable and require less work.
- Cost Spent
Manual methods are considered less expensive than automation since they do not require the purchase of expensive AI technologies. In fact, the manual method remains costly because it requires a large amount of human effort to handle the documents on a daily basis. These costs add up over time, especially for businesses managing large volumes of data.
Using AI tools will cost you initially but offer long-term savings. Once implemented, there are no recurring costs unless you choose to expand or upgrade features. However, even if you upgrade it to new features, the overall cost remains lower than manual methods. It also saves costs, as you only rely on the system and do not require numerous resources.
AI tools like Fintelite can reduce costs by up to 30%. This significant saving allows businesses to allocate funds to more critical priorities.
Conclusion
Based on the explanations above, automation is an effective way to manage credit reports. With benefits such as reduced time consumption, higher accuracy, and cost savings, it helps companies achieve their goals through more productive and efficient operations.
Fintelite is one such reliable AI tool that can streamline credit report processing. It provides a user-friendly credit report template within its dashboard, making the process even easier and more efficient.
