The impact of non-compliance of relevant regulations can have a detrimental effect on all credit providers
in South Africa.
“The penalties and fines for non-compliance can ultimately cripple a business,” says Vaughn
Hechter, Head of Customer Services: NuPay and Delter at Altron FinTech.
“There is also the reputational risk, because nobody wants to do business with reputation of being a loan shark or a predatory lender.”
Keeping up with complex local and global regulations like GDPR (General Data Protection Regulation), PCI
DSS (Payment Card Industry Data Security Standard), PSD2 (Payment Services Directive 2) and FICA
(Financial Intelligence Centre Act) is tricky, especially when you’re trying to focus on the day-to-day
challenges of running your business.
The financial landscape can change incredibly quickly, as the reversal of the 0.5% VAT decision showed. How do you grow your business whilst ensuring you are staying on top of what the law says you need to be doing?
The solution lies in automation. LMS (Loan Management Systems) provided by companies like Altron
FinTech take all the checks and processes required by the law and do it for you in a matter of minutes. Your
customer gives you their details including their ID number, you enter the information into the system which
then runs the checks, and everything is calculated automatically. The applicant knows then and there
whether they qualify for a loan, as well as how much they will need to repay, and when.
Less admin, less worry
Without this kind of automation, loan providers would spend much more of their time on admin. Making
mistakes is easy when there are so many regulations, and keeping up with complex changes can be stressful.
Entrepreneurs already have so much to think about, without worrying that they’ve missed an important
detail.
“We are continuously evolving according to our customers’ needs,” says Hechter. “We also make a lot of
effort to adapt to the changing regulatory environment. We invest in secure platforms and systems. We’ve
built up the skills internally as well a network of people that have worked with us over years. Most
importantly, we work with our customers and then we customise systems and solutions to make it easier
for them to be compliant.”
AI and Open Banking are two of the latest trends in financial services and that means more challenges and
opportunities for compliance. AI can make checking for fraud much quicker and more efficient. Open
Banking is a system that banks use to share customer financial data with third-party providers, like fintech
apps, through APIs (Application Programming Interfaces), but with the customer’s permission. This makes
it easier to provide innovative financial services and improved customer experiences.
Practical solutions, right now
Even with all this innovation, something as simple as lending money to a customer can still be very
complicated. That’s why Altron FinTech has developed several solutions to help credit providers in South
Africa stay compliant, while making it more affordable for them to do business.
These include:
- Delfin: a complete onsite, customisable loan management system for bigger customers. Delfin
includes loan documents and contracts, integrated authenticated collections, card payouts, credit
bureau account updates and credit checks; - Webfin: an online, browser-based, creditors management system designed for smaller loan
businesses. No installation is needed and with its easy-to-set-up design, it allows for customisation
to fit your business model. With Webfin you can view reports, approve loans and manage customers
from anywhere; and - Webloans: an online loan application portal that integrates with your current website, allowing your
customers to apply from anywhere and enabling you to manage the applications on Webfin.
Tools like these, which include automated credit risk assessment, fraud detection, and secure data
handling, all help to reduce the risks of not complying with the law. And because service providers like
Altron FinTech are constantly updating their systems with the latest changes, business owners who use
these services know that they’re getting the best possible expertise.
Many of Altron FinTech’s credit management customers operate in the microfinance industry, and the
company recognises the importance of its role in promoting financial inclusion while helping customers to
maintain compliance. This is why making compliance easier and more affordable is so important.
As Hechter says, “We would like to rather educate business owners and help them be compliant.”
Together, established fintech leaders like Altron FinTech and new entrepreneurs in microfinance can help
give every person in South Africa access to the finance they need to achieve their goals.
