A Heavy Increase in Processed Loan Requests Number at SKB Bank

  • x15 loan requests processed

  • $100 000-200 000 saved

  • Significant increase of the loan pipeline productivity

The Story

A few years ago SKB Bank was a conservative-minded bank, widely represented across the whole country, with strong ambitions. The bank management desired to significantly increase the amount of loan requests processed. This could be only performed by a game-changing digital transformation — creating a new system which would automate most of the manual jobs. Certain budgeting constraints for digital transformation initiatives made it hard to fulfill such ambitions.

First, the SKB Lab (an SKB Bank technological subsidiary) team considered an existing banking solution by IBM. Its price was estimated at $100 000-200 000 at the start, with mammoth extra expenses for scaling up. To avoid such a huge financial risk, the development team decided to use open source technologies, including CUBA Platform (now Jmix). During the 5 years of working with Jmix, SKB Lab spent just $8 390 on license fees and about $3 500 on training and consulting services.

The loan pipeline MVP was created and performed just in 6 months by 2 developers and 1 business analyst. The architecture proved its efficiency, and the application went live. On average, its latest version processes 8 000 loan requests a day compared to 500-800 requests a day before the pipeline adoption. But it’s not the limit.

The SKB loan pipeline is a true technological breakthrough implemented with open-source technologies and boosted by Jmix development tools.

How it Works

Initially, the main task was to increase the loan pipeline productivity 10-fold and make a 7-10% conversion, with the request processing time no more than 5 minutes. After a deep analysis and optimization of the bank’s request processing model, the cross-team of developers and risk managers performed a new scoring model based on interaction with the third-party digital services.

The SKB Lab team picked up an open-source technological stack: business process orchestration performed by Camunda BPM, enterprise service bus — Apache ServiceMix, application development based on Jmix. This stack was cheap, but covered all the functional requirements, performed wide horizontal scalability resources, and supported cloud infrastructure. Thus, all business logic was created on Jmix.

Currently, the loan pipeline development team grew to 20 people including 6 Jmix developers.

“Developers adopt a new technology (CUBA/Jmix) very quickly and become efficient in 2-3 months, usually even faster.”

The team continued improvements and created the Credit Batch Assessment System (CBAS) which almost eliminated the manual work and minimized the number of requests to the credit bureaus.

Further solution development faced a new aim — lessen the dependency between the number of requests and expenses for their processing. For example, with x5 growth of requests, the expenses increase threefold, because each loan application supposes a request to a credit bureau — which has its own cost.

To reduce those costs, SKB team performed a new loan processing concept, Credit Batch Assessment System (CBAS). The system can:

  • Listen events (triggers) and get data for customer analysis, create validation objects and group them into batches. Also, it makes batch requests to the Credit Registry — a connector to various credit bureaus. Those features lessen the number of requests to the credit bureau and, therefore, the loan request processing cost.

  • Filter and standardize data, perform accounting to reduce the loan request processing time, and increase the pipeline productivity.

  • Perform queries to the enterprise service bus and make own calculations to replace manual jobs and eliminate the human factor.

This system implementation reduced the time of request processing and the level of fixed costs (license fees, support expenses, calculation resources expenses). Besides, it is possible to use such a pipeline approach for almost any banking products and services.

"Depending on the project lifecycle, CUBA boosts the development several times compared to custom open-source stack development. This is achieved by the platform’s main features: a greatly elaborated “enterprise core” and modularization.

By the enterprise core we mean:

  • Data model based on entities (objects)

  • Role-based access control

  • Session management and scalability

And by modularization we mean Studio features (development speed up and unification of development approaches) and modules reuse (not just code snippets, but full-fledged modules with internal business logic and a common core)."

Igor Klopotov, Product Architect at SKB Lab.

SKB team continually implements new system features. Actual release cycle is once per 2 weeks. The innovative scoring model, batch requests concept and real-time customer info update is aimed to process 50 000 loan requests a day. It’s a heavy increase in the loan requests processing efficiency. Such level of automation is one of the factors which ensured SKB Bank’s high competitive capacity.

The loan pipeline is continually evolving and keeps improving with the help of Jmix. Current functionality implementation plan includes the bank’s own credit bureau, integration with the CRM, loan limitation management, and other capabilities.

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