How AI Is Impacting Mortgage Lending Processes

The typical mortgage lending system has become archaic until just recently. For too long, the mortgage industry has relied on manual processes, paperwork, and legacy systems. Even as new technology has emerged to disrupt adjacent sectors, most mortgage lenders continued to lag behind, reluctant to let go of their existing operations. Mortgage brokers and banks are almost always ultra-conservative and afraid of change.

Finally, the industry may be on the brink of a digital transformation. AI offers a promising solution to reduce costs, accelerate the speed at which loans can be closed, reduce (or eliminate) errors, and improve customer experience. Here is why artificial intelligence can help mortgage lenders and brokers. 

Introducing AI 

Before diving into the potential applications of AI for the mortgage industry, it is vital to clarify what the technology entails. There are three main types of AI to be aware of: RPA, AI, and machine learning. 

RPA 

The simplest type of artificial intelligence is robotic process automation (RPA), which programs a machine to perform a specific function. These bots can’t act independently or make their own decisions; they can only follow the particular commands they have been given. 

You have probably come across them yourself already. Chatbots on websites are a perfect example, as are social media bots that give specific comments to certain keywords like on Reddit, Instagram, Threads, or Twitter. 

AI 

AI is a somewhat broad term that describes a machine that can perform human-like functions. Unlike RPA, it is capable of reasoning, problem-solving, and taking different actions depending on environmental cues. This makes it one step closer to imitating humans. 

In the context of mortgages, AI can read a document and extract relevant information. 

Machine Learning 

Machine learning takes AI a step further. Not only is it capable of reasoning, but it can also analyze information, learn from it, and use that to make predictions and recommendations. In some cases, this can mean it is even more effective than humans. AI and the mortgage industry. 

As anyone who has ever taken out a mortgage will know, the process involves a lot of documentation. Mortgage servicers are responsible for handling all this paperwork manually, which takes up a lot of their time and makes the process slower for customers. Even worse, it increases the probability of human errors, which cause delays and stress. 

The use of automation means time-intensive data entry work can be performed by technology, freeing workers up to focus on more important tasks and provide customer service. 

Thanks to recent developments in AI, like machine learning, technology is now becoming smart enough to do this work with minimal human supervision and a low chance of errors. Tasks it can perform with home loans include: 

• Gathering information 

• Reviewing documents 

• Performing verification checks 

This helps to remove barriers and friction for everyone involved in the mortgage process, bringing down costs and providing a better customer experience. 

Introducing AI Powered Lending Platforms 

AI offers a promising solution to transform the industry, which is why mortgage automation platforms plan to leverage it. The mortgage origination process currently consists of various manual tasks that slow companies down and result in inefficiency and errors. Simply put, comparing the best refinance loan rates or home loans without the use of technology is troublesome. 

These modern day mortgage lenders use machine learning technologies to extract, process, understand, and classify data, allowing mortgage providers to offer better service to more customers and boost productivity. Lenders can then reduce their turn times and costs and scale their operations more quickly.

How Do Payment Portals Work?

The global use of online payments will surpass credit and debit card usage over the next four years, possibly even by the end of 2021 or early 2022 due to the Coronavirus pandemic e-commerce impact. Many more businesses shifted to digital payments and ecommerce stores when brick and mortars were locked down or went out of business.

By 2023, approximately 1.31 billion people are forecasted to use mobile payments over a six-month period. Payment portals and gateways adoption is set to double in the US by 2025. 

Accepting payments online is a major feature of many websites, but how do pay portals work? 

This article looks behind the scenes and explains the process of collecting payments online quickly and securely. 

Payment Power

Below you will learn the differences between payment portals, payment gateways, and processors. Find out about the different gateway types and how transactions remain secure. Discover which pay portals target specific industries like health care. And how are payment becoming more frictionless while maximizing safety?

Read on to learn how a payment portal can keep you and your customers safe when paying online. 

What Are Payment Portals? 

A payment portal offers a secure means for customers, clients, and patients to make online payments using their credit or debit card. 

In the growing world of e-commerce, customers add items to their cart and then check-out. The checking-out process is often handled by a payment portal. Customers submit their card details, name, and address, and the portal handles the transaction. 

In the healthcare industry, pay portals act in a similar way to a shopping cart. 

Patients visit their doctor's website or a dedicated page to pay for their procedures and prescriptions. All data gets encrypted to ensure Patient Health Information (PHI) confidentiality. The patient can then view all their past transactions on the secured screen for full payment history. 

Pay Portals and Payment Gateways 

Payment gateways and portals are often used as interchangeable terms. Yet there is a slight difference between these two terms. 

A payment gateway acts as the technology behind the security. It ensures the safe transfer of sensitive information like a credit card number or CVV. 

Gateways also process card payments through a merchant service account. They request authorization from credit and debit card companies and process those results. Once accepted, the gateway returns a successful transaction code that the website can display to the customer. 

Payment Gateways Versus Payment Processors 

Payment processors analyze and transmit transactional information. Yet they don't authorize the transfer of funds between the seller and buyer. 

A payment gateway includes both services. 

Types of Payment Portals 

Three types of payment portals exist for online sellers to accept payments: 

1. Redirect services 

2. Off-site payments 

3. On-site payments 

A redirect service takes the customer from the seller's website to the processor's website. 

PayPal is an example of a redirect service as it processes payments on PayPal.com. Users get transferred and have the option to log in or enter their card details. However, some people find this confusing and abandon their checkout as a result. 

On-site and Off-site portals keep the customer on the seller's website. Instead of being redirected to a third-party site, they enter their card details on a familiar screen. 

The difference between the two is where the processing takes place. 

Off-site payment portals process payments behind the scenes. The payment details get sent securely to a third-party who then returns the authorization status. The seller must use an SSL secure connection, which we'll discuss shortly. 

Large enterprises use on-site payments as they process payments themselves. They have full control over every detail but the system is extremely costly to maintain. 

Integrating Payment Portals 

How do online payment portals work on existing websites? 

Depending on their website platform, online sellers can add a payment portal in a few steps. For example, Shopify merchants can add payment gateways through their Shopify Payments service. 

They require an Employer Identification Number (EIN) and their bank details. Once added, Shopify lets customers in the US pay by: 

• Visa 

• Mastercard 

• American Express 

• JCB 

• Discover 

• Elo 

• Diners Club 

WooCommerce can integrate with 100 payment gateways by installing the right extension. 

WooCommerce Payments is a dedicated payments service designed specifically for the platform. It's free to install and merchants only pay the transaction fees. 

Wix users must upgrade their site to the Premium Plan to accept payments. 

The admin dashboard offers several options under the 'Accept Payments' tab. From here, they can choose a payment method and click 'Connect' to use them. 

All pay portals integrate with any type of website. Read the documentation and ask for assistance to set things up correctly for web payments. 

Examples of Payment Gateways 

Some common payment gateways include PayPal, Stripe, Square, WorldPay, and Authorize.net. 

Payment wallet processors that target mobile phone users include Apple Pay and Google Pay. Amazon also has its own payment gateway called Amazon Pay. 

Specific Industry Types 

Certain industry types can benefit from specific payment portals that are designed to fulfill a particular task. 

QuickPayPortal is known as a patient portal as it allows patients to pay for their medical bills and services online. It's fully HIPAA compliant and can be used to book appointments too. 

How Are Online Pay Portals Secured? 

Online merchants are responsible to keep their customers' data safe and reduce the risk of fraud during payment. The factors below help to ensure transactions remain secure. 

• SSL Secured 

• PCI Compliance 

• 3D Secure 

• Address Verification Service 

SSL security encrypts data sent and received from a website. That's essential when submitting card data for processing and collecting authorization information. 

To tell if a site is SSL Secured, check the lock icon on the address bar of the browser. If it's locked then the site is secure. You can also tap or click on the icon for more details. 

PCI DSS is a set of regulations created by the major payment card brands. It requires vendors to comply with 12 data security requirements. However, payment portals cover these issues so there's no cause to worry. 

3D Secure and Address Verification Service (AVS) add extra security measures. They require customers to add additional information like a password to complete their purchase. 

Payment Gateways and More at Frugal Finance 

Payment portals enable any type and size of business or seller to accept payments online.

Integrating pay portals is relatively straightforward. The main issue is deciding which service to use. 

Make sure to research transaction fees, initial charges, and the terms and conditions. Also, ensure the service offers full security at all stages of payment and authorization. 

Read more about payment gateways, fintech developments, and e-commerce transactions in our Tech section. 

We have articles on accepting online payments and selling online with secure ecommerce stores. Be sure to bookmark us as we add content regularly and check out other categories like business or finance for additional insights. Read more of our posts in the Frugal Finance and Tech sections and pay attention!

How Modern Technology Made Trading Easy And Popular

Technology has influenced the modern world. This assertion is more true now than it has ever been when it comes to finance and investing. The impact of technology on us increases with each passing day, especially in the realm of fintech. The Forex sector is one of the beneficiaries of this move. As technology progresses, financial institution scope grows. The Forex markets benefit from technology in a number of ways. From improved data and analysis tools to newer platforms with customization choices to suit your needs, technology has made the life of every Forex trader a lot easier. 

The Very Beginning Of Trading

At first, currencies and shares had to be physically owned with paper documents, bills of money, and stock certificates. You had to look in the newspaper or the pink sheets to find prices, or work with a broker by phone and mail. One of the first breakthroughs was the invention of computers and their widespread use. Computers allowed for faster data processing and more data manipulation options. For all of the brokers, this was a sobering fact. They did not have to wait for analysts to complete their analysis before taking action. Brokers were more accessible to new technology available to them than they were before computers. Even with all that processing capacity, there were still a few hurdles to clear before trading could begin. You cannot fully use any of the tools properly that are given to you unless you know how to use them right. The key lies in learning and not stopping when you think you are done - you never know everything, and there is always a place for improvement. 

Knowledge Is Power 

At the time, a common man's dilemma was challenging to solve. To learn how to trade, a person will need to spend a lot of money and buy many books. Even back then, believing that an individual could master the art of trading was a risky proposition. People spend a lot of money on various books, seminars, and courses to get on the same level as experienced Forex traders. However, they still lacked a lot of factual information about getting started trading. 

This problem eventually faded away with the advent of the Internet. Since the birth of the world wide web, the rate at which we communicate with information has accelerated dramatically. Not only did a plethora of trading guides and knowledge appear, but the speed at which the information spread also increased dramatically. Due to the speed of the Internet, financial institutions could track market movements in real-time, allowing different platforms to provide online trading. Online information about Forex brokers was also available, making it easier for people to find out who to trust while also enabling Forex brokers to be more trustworthy hence many being fearful of fraud, thus not getting into it. 

Smartphones Becoming More Common 

With that said, there was still one more piece of this story's puzzle to be solved. Despite the fact that our processing power and the speed at which we transmitted data had both improved significantly, there was still something else we needed. More functionality was needed. Following the launch and later growth of smartphones, the Forex markets skyrocketed. The trader didn't have to wait for deals in his home, and he didn't have to miss a significant event because he wasn't near his computer. With smartphones, everything was just a click away. Phones now have the same processing power as computers and can connect to the Internet, making them a valuable trading tool. 

Forex markets expanded as a result of this expansion. A slew of new media outlets sprung up. It includes a variety of incentives, better Forex traders, better beginner training, and better overall conditions. 

Modern Trading Moves Forward 

Naturally, there are still several aspects of technology's trading side that could be improved. By examining how quickly we moved from the invention of computers to the Internet, and then from the Internet to Smartphones, you can estimate the rate at which new technology is invented and how fast it is moving and evolving. That means we can expect more technical breakthroughs, which will affect the Forex markets, making them more stable, transparent, and accessible to new traders.

AI In Financial Services | DreamQuark Innovative Solutions

The Close Link Between AI and Financial Services 

AI in financial services is occupying an increasingly important place. Some may even argue that artificial intelligence is at the heart of a true financial revolution. FinTech has the potential to transform various models in the finance industry globally as more of their decision-making processes already revolve around data. Gradually, artificial intelligence is leaving its role as a convenient solution to facilitate payments and transactions to assume that of a full-fledge business configuration. 

Innovation: A Driving Force 

As the world as a whole continues to evolve, AI in financial services naturally progresses if only to keep up with expectations, be it for B2B or B2C products and services. 

Hardware capabilities are leaps ahead of what they were even as little as five years ago. The smartphone revolution, for one, has constituted an invitation for FinTech developers to bring the financial world up to speed in a race to meet the growing demand for compatible services. 

The advances of back-end tools have also been promoting growth in the sector, with actors such as DreamQuark developing AI-based solutions aimed at industry professionals (banks and insurance companies). Their software, Brain to Train, has enabled these organisations to deploy AI financial services on a large scale, thus encouraging their adoption. 

To put it simply, as the finance industry is implementing artificial intelligence into their business models and end-users have tools at their disposal to take advantage of new functionalities, the demand for AI solutions continues to rise. Similarly, the finance industry depends on it more and more. 

Towards Meeting An Ever-Evolving Demand 

One of the main roles of AI in financial services is to collect, analyse and interpret big data in order to provide finance organisations with tailored recommendations based on their short and long-term goals. New technologies allow the finance industry to adapt to the changes in regulatory compliance requirements and to align with customer demands. Three major areas stand out in how deeply they have come to depend on AI. 

Financial Crime And Fraud 

Machine learning – a subset of AI – is at the heart of the models used to fight fraud and financial criminality. Deep learning allows irregular activities to be detected in real time and is a scalable solution which provides more accuracy than traditional methods. This use of AI in financial services inscribes it as a highly dependable asset the industry has come to rely on. 

Credit Risk Management 

AI in financial services is also becoming more prevalent in credit risk management, another area where data plays an important role, especially in probability of default and early warning signals. Artificial intelligence allows for the implementation of monitoring measures thanks to which risk is assessed on a constant basis. 

Customer Experience 

The digital era has led many industries to experience heightened customers’ expectations. Encouraging a culture where instant gratification is the norm, new technologies create a cycle where industry standards need to follow the same trend. Any complacency would cause them to be left behind as consumers continue to embrace progress. Chatbots are a good example of how banks can use AI in financial services through which they can both provide customers with a more seamless experience and collect valuable data. Their clients get immediate answers to their queries and can interact with their accounts straight from their smartphone. They can also receive insights and recommendations. 

While these interactions take place, artificial intelligence gathers data and analyses which digital experiences the consumers favour, which options generate the best conversion rate, etc. Banks want to cultivate a relationship with their customers. They want to understand them and to provide them with an experience that will encourage their loyalty. AI can help them to just that!

How To Send ACH Payments Securely

Nowadays, there are tons of ways to give and receive digital payments. There are several apps, websites, and other ways to accept online payments from around the world.

The chain of sending ACH payments or wiring money online goes from the originator through the bank and then to the beneficiary. 


Sending ACH Payments

ACH Payments have been around since the 1970s and may seem like a dinosaur. However, there are more agencies, banks, and institutions that are sending and receiving funds through ACH than ever before.

The most recent numbers compiled to asses this reveal that the ACH network dealt with $23 billion payments adding up to $51 trillion dollars.


What is ACH?

ACH or Automated Clearing House is the main system agencies use to transfer funds electronically. Funds get deposited into financial institutions and payments are made through online transactions. 


How Do ACH Payments Work?

ACH payments go through the ACH Network. Funds go from one banking institution to another by way of a centralized system (ACH). The system then directs the funds to the intended person or business. 

These payments can be set up to reoccur and several employers use them to pay their employees. They offer benefits for both consumers and merchants. Bookkeeping with ACH payments is simple. You just use the feature "send check online".


Who Uses ACH?

As mentioned above a lot of people are using ACH all over the world. If you're an employer and pay workers through direct deposit, you probably use some form of ACH.

If you pay your monthly bills electronically with your checking or savings account, you use ACH. 


The Ins and Outs

If you dig a little deeper into what ACH is all about you will find that large numbers of transactions through ACH can be from several different sources that are batched together. They can be successive payments or just a one-time thing.

An ACH Direct Deposit is different from an ACH Payment. However, it does use the same kind of processing network. ACH Direct Deposits are for things such as tax refunds, interest payments, annuities, and of course payroll. 

ACH payments are categorized in two ways; ACH Credits and ACH Debits. ACH Credits send or push the funds from a customer's account to yours. 

ACH Debits withdraw or pull the funds from the customer's account and put them in yours. Pulls are usually made on mortgages, rent, gym memberships, car payments, utilities, and insurance premiums.


NACHA

NACHA is a not-for-profit association that manages the administration, governance, and management of the ACH Network.

NACHA sets up the rules for ACH. However, the actual processing is overseen by The Clearing House Company and the Federal Reserve.

Credit unions, banks, merchant providers, and any other entity that participates has to adhere to the rules of NACHA.


Make Your ACH Transactions Secure

The best way to make your ACH transaction secure is to follow these four steps.

• Set-up Merchant Specific Registration
• Micro Deposits
• Encryption & Tokenization
• Secure Vault Payments

Look for merchants that have some or all of these features for sending ACH payments safely and securely. You should also avoid using public computers or public WiFi when completing any financial transactions to keep your information safe.


Transaction Approved

It seems almost impossible that something so modern has been around for such a long time. If you ask anyone on the street what is ACH exactly, they probably wouldn't have a clue.

As a society, we have only just begun to fully embrace the world of digital banking, investing, and electronic payments over the last decade or so. Without realizing it, we have been banking electronically by sending ACH payments for almost 50 years.

Looking for more financial information? Keep checking out our site. Visit the Frugal Finances and Tech sections of our financial blog for more information on fintech, payments, banking, and much more.