Streamlining_Business_with_Electronic_Signatures

Streamlining Business with Electronic Signatures Using electronic signatures for loans rather than paper will increase member service and save the company time and money. Many consumers are looking for everything to be a quick and easy process. With electronic signatures, not only can the company consider and market consider themselves green but it will save them money and time as well by streamlining the processes they already have in place. It will allow members to have the customer service they are looking for in a financial institution and give them the convenience that people need. In the quad cities, Iowa and Illinois, I work for a financial institution that prides itself on member service. We are a company of roughly 90,000 members and about $746 million in assets. We have the ability to serve members in our surrounding area but only in a 50 mile radius. Our credit union is focused on member service and being the best. We are a full service credit union, offering everything from savings and checking to home mortgage and student loans. Most people in their life will have some type of loan. I currently work as a loan officer at the credit union and deal with many types of loans and members on a daily basis. The loan process is time consuming for employees and members. An estimated time spent on each loan would be roughly 6 hours from start to finish. It roughly takes a total of four days, when you include the time the documents are traveling from department to department. The process starts with a loan officer collecting all of the information from the member. After it is approved, first I upload any documents that were required by the member. Then I print two set of documents. The first goes to the member and the second is signed and sent by a currier to the corporate office. The currier picks up the forwarding mail 3 times per week. Once there it is given to the loan department that checks the loans and enters that information into a spreadsheet. They then print a copy to go with the file, and everything is passed to the scanning department that uploads a copy onto the records system. The process as it is now with the credit union I work for, displays many areas that could be improved. One major problem seen with members is that it is not always convenient for them to get to a branch to sign paperwork. If a signature is missed by the member they are required to come back into the branch and sign the documents again. This can be very inconvenient for members and can cause then to not finance with you in the future. Many members are looking to sign without having to come in and want to do everything online. With electronic signatures this could be possible. Members could sign the documents and send them in or they could come into a branch and sign. The loan would then be able to be viewed by all departments. There is no need to call members and have them come in to resign documents. I have not always been a member of the financial institution that I work for. In the past I have had the experience of signing loan documents at other institutions. During the process the application information was collected face to face and once the loan was approved, I looked over the information on a tablet device and signed accordingly. I then received a copy of the signed documents and electronically they were sent to the receiving departments. I have never received a call that my papers have been misplaced. I was in and out in a few minutes. I did not have to wait for paperwork to print and had I needed to change something it would have been an easy process. To me this was good customer service. It was a quick process and I knew I was done with my part. Looking at this made me decide to look at the process and how members would feel about the electronic process. I decided to sample 15 members of the credit union that have been in for loans over the past few weeks to find out how many members would be comfortable and like the idea of electronic signatures. I wanted to know if members would be receptive to the idea or if they would fear the idea of it being electronic. The members ranged in age from 26 to 74. They were all doing auto loans’ being that is where most of our volume is from and all from different backgrounds. The members were familiar with the computer but not all were proficient with it. I gave the members a sheet that had 3 questions on it. I asked them to write yes or no on the paper and turn it back into me. In polling 15 credit union members I found that: Would you prefer to sign documents electronically' Yes: 12 No: 3 Yes: 12/15=.80 or 80% No: 3/15= .20 or 20% Do you feel this would be a more convenient process for you' Yes: 11 No: 4 Yes: 11/15=.74 or 74% No: 4/15=.26 or 26% Would you prefer to sign documents and electronically send them in' Yes: 9 No: 6 Yes: 9/15= .60 or 60% No: 4/15= .40 or 40% 80% of members would be in favor of electronic signatures. More than the majority of members sampled would prefer to sign their documents this way indicating that they would find this to be better customer service. The demand for electronic signatures has increased as mobile technology has thrived and people increasingly want to do business over the Internet. (Hoge, 2012). Many people these days are using their phone for everything they do. It can be time consuming for someone to drive into a branch and sign paperwork. Even at that they are usually hurried through and do not have time to fully read the documents. With electronic signatures the documents could be sent a head of time so they could be ready by the member. 74% of members thought it would be a more convenient process. “E-signatures make life convenient and result in faster turnaround. They save time and gas, and make it unnecessary to drive to a branch or retail storefront just to sign documents. They accelerate processes so that virtually any transaction – mortgage, car loan, student loan, insurance application, credit card account opening, etc. – can be completed 100 percent electronically.” (Power, 2012) Members are able to get it done and get on with their lives. With people being so busy, they don’t want to have to do things twice. People want convenience and the ability to do things on their time. If the loan officer is able to convenience more members their sales are likely to increase for the credit union. Members were less receptive to the idea of sending in their documents. The majority of members (60%) still would prefer this method and have it sent electronically but the other 40 % would prefer to sign them at a branch in front of a loan officer. I would attribute the percentages to the fear of having their information passed over the internet, and the convenience of being able to ask questions in person if needed. Another complication seen from department to department is how easy it is to misplace a piece of paper, which can easily delay the loan process. This causes us to have to contact the member and have them drive into a branch to resign the documents. This makes the institution look as if though we are a disorganized credit union. With electronic signatures this would not be a problem, in that the documents would be electronically signed and be available to view by all departments. There is no paper to loose. With doing loans on paper it is a costly process to get the documents needed if we have to redo the loan. On average I get do about 40 loans per month. At the end of the month when loans are due to be checked I would say about 10% come back as missing information or that the loans are not anywhere to be found. With this there are costs in having to reprint the documents and do the process over again. Simple business transactions are slowed while contracts are mailed back and forth for the required signatures. Businesses today spend millions of dollars a year on expenses associated with contracts and other documents. The credit union must pay for the printing, copying, express mailing, and storage of documents. Using electronic signatures would eliminate many of these costs. I looked at the departments that process the loans on a regular basis and polled the employees at the credit union. I first looked at the financial service officers. We are the ones on the front line taking and preparing the information. We gather all of the signed documents and send them to the loan admin department at the corporate office. The paperwork consists of about 25 pages of documents. Loan admin gathers them and checks the documents for mistakes before sending them to the scanning department. Scanning uploads them into the computer, makes sure all documents are present and then shreds them. In these departments there are about 5-10 people I contacted the departments and sent five 3 question surveys to the individuals and asked the following questions: Questions asked to employees: 1. Do you feel your department would benefit from electronic loan signatures' Yes: 14 No: 1 Yes: 14/15+= .94 or 94% No: 1/15= .06 or 6% 2. Do think this would save you time' Yes: 15 No: 0 Yes: 15/15=1.0 or 100% No: 0/15=0% 3. Do you think this would increase member service' Yes: 11 No: 4 Yes: 11/15= .74 or 74% No: 4/15= .26 or 26% Employees at the credit union are favorable of the electronic signatures. 94% of the people feel that their department would benefit from this service. If the employees did not have to wait for documents to be sent to them they would be able to get the loans done in a quicker manner. This would allow the loan to be on the books sooner and the credit union to start charging interest quicker. It would eliminate many steps for the employees and possibly even eventually have the ability to replace the scanning department. 100% of employees thought that this would save them time. If the company is freeing up time for the employees to do other things they will be able to better utilize their skills and have the production hopefully increase. If there is less time spent on scanning and waiting for documents they have more time to do other work. The departments would have freed up time to be able to accomplish other tasks. It gives the ability for less work and less stress on the current employees. 74% of employees thought that member service would increase. The process would be streamlined for the member and they wouldn’t have to be inconvenienced for these reasons. I found that the employees that did not think it would increase member service, were employees that did not deal with members on a regular basis or did not know the full loan process. Most employees still did find that this would benefit our members. It cuts down on the process for them, and anything to make it more convenient, seems to please people. The loan process would be able to be streamlined with the addition of electronic signatures. The new process would involve each person in the transaction (purchaser, seller, broker, etc.) reading through a document on a computer, iPad or similar device, then applying a signature electronically in each required place. Because it's all electronic, you can't miss a page or skip over a spot where you need to sign; the document will prompt you every time you need to sign or initial. The credit union loan officer will print a single copy of signed loan documents or membership cards for the member, then automatically store an electronic copy with an embedded signature eliminating extra printing and time-consuming scanning. The document would automatically be available for other departments to view. The loan admin department would be able to check the loan with a very short turnaround time. Nothing would need to be scanned because it is already in the system. It would then just be available on the system if needed for later use. In order to implement this, there is much more research that needs to be conducted and evaluated. There are downfalls to the implementation of this plan, such as the initial cost to install the devices, privacy issues, and problems with identity theft. The benefits and costs would need to be weighed and further evaluation done. The credit union would want to look at the benefits and costs of the electronics to proceed further. I think that being a financial institution we need to adapt to how consumers want their data given to them. This will allow the credit union to grow and increase their sales. In conclusion I think that more research needs to be conducted to see the benefits and costs of having electronic signatures installed. “Those that have gone paperless say the benefits are many. Companies can save not only trees but time and money with smaller, uncluttered offices and more efficient methods for finding documents.” (Turner, Melanie, 2012). If employees can save time and increase member service they are being more productive for the credit union. The percentages show that the majority of employees would benefit from integrating an electronic signing system. With no paper there is no worry of losing documents. This causes less time and money to be spent on reprinting documents and inconveniencing our members. The survey shows that members feel they would benefit from electronic signatures as well. People are on the go and want to have things done at their convenience. With electronic signatures members would be able to review and sign documents at their convenience and send back to the institution, they can otherwise come into a branch and sign electronically. With consumers looking for convenience and companies looking to please members and lower costs, electronic signatures would be a benefit to all parties included in the transaction. References: Cooper, D.R. & Schindler, P.S. (2011). Business research methods (11th ed.). New York: McGraw-Hill Irwin. Hoge, Patrick (2012). Area tech firms chase the e-signature market. San Francisco Business Times. Retrieved from: http://www.bizjournals.com/sanfrancisco/print-edition/2012/01/13/area-tech-firms-chase-the-e-signature.html Power, Mary (2012). Consumers Driving Adoption of E-Signatures 12 Years After Federal ESIGN Law. PR Web. Retrieved from: http://news.yahoo.com/consumers-driving-adoption-e-signatures-12-years-federal-170028807.html'_esi=1 Turner, Melanie (2012). Going paperless streamlines offices. Sacramento Business Journal. Retrieved from: http://www.bizjournals.com/sacramento/print-edition/2012/02/17/going-paperless-streamlines-offices.html