Loan Servicing Solutions

The loans market in Canada is a billion dollar business, and lenders in this competitive industry need to be as cost-effective and efficient as possible in order to remain viable. But lending can be an administratively burdensome and intricate task, and for that reason a whole genre of companies have sprung into existence to help loan companies with their operational needs.

These companies are known as loan servicing and payment solutions companies, and can assist lenders in all manner of ways. In this article, we’re going to delve into the world of loan servicing and payment solutions, taking a close look at the various tools on offer, the functions they perform, and how much they cost. Let’s start with a list of some of the premier companies currently operating in Canada, shown in the table below.

Best Loan Servicing and Payment Solutions for Lenders

Company
Features
Pricing
Reviews
Availability
Creditbook Check - Alternative Database, Risk Management Solutions for Lenders.
Request custom quote
All of Canada
Credit and Debit Card Processing, ACH Processing, Instant Funding
All products priced separately
Canada & US
Data Platform for Lending Companies
Flexible Pricing Models Available
Canada & US
Instant Banking Verification, ID Verification and Risk Scoring
Starting at $0.50 CAD per verification
All of Canada
Payment Processing Solutions. Digital Payments. Perfect for FinTechs, Lenders and Digital Platforms.
Startup and Enterprise options available. All products priced separately
All of Canada

What are Loan Servicing and Payment Solutions?


Loan servicing is a term that encompasses a range of functionalities offered by third party companies in order to help lenders manage and administrate their lending business, over the full lifecycle of their loans - from origination to final reporting. This goes hand in hand with another important service available to lenders: payment solutions.

Although many loan servicing companies offer payment solutions as part of their packages, there are also dedicated payment solutions companies available to lenders, whose sole purpose is to facilitate seamless and effortless customer payments and reconciliation.

Both loan servicing solutions and payment solutions are available to lenders in every category of lending, from payday loans to mortgages, as well as for small Canadian lenders and big international lenders, and a variety of interest types. The breadth and flexibility of these services mean that almost any lender can realistically use them.

What Can These Companies Help With?


The various functions that loan servicing companies and payment solution providers can assist with include:

  • Customer Acquisition
  • Loan Pre-Qualification and Application Receipt
  • Loan Application Processing
  • Credit Decision Making
  • Loan Origination
  • Underwriting
  • Customer Communications
  • Payment Solutions, including
    • Web, mobile, text and in-person payment options
    • Credit and debit processing
    • Automated clearing house processing
  • Receivables Management
  • Compliance Management
  • Document Management
  • Loan Closing
  • Loan Reporting
  • Reconciliation

Almost all of these functions come as part of Software-as-a-Service (SaaS) solutions that lenders can purchase and either install or use on the cloud, ensuring maximally efficient in-house use. Some providers cater to specific types of lender (for example, mortgage lenders) while others are more general.

Benefits of Using Loan Servicing Software


The advantages of loan servicing tools include:

  • Increased accuracy and fewer errors
  • Simplified portfolio management
  • Reduced operating expenses
  • Increased revenue
  • Improved regulatory compliance
  • Better customer service and higher customer satisfaction

However, most of these services come at a cost, usually either via a small fee on every loan payment made, known as the servicing fee, or via monthly or annual fees. As fee structures and prices can vary, it is incumbent on lenders to request a quote to fully understand what their expenses will be. It’s also important to know that there are some open source solutions available, for the cost-conscientious, but be aware that these lack the customer support aspects that paid solutions offer.

Loan Servicing and Payment Solutions Providers


Now let’s take a look at some of of the leading providers in this space in Canada, across a range of specialties:

TurnKey Lender

Specialty: Automated end-to-end solution for all lenders

TurnKey Lender boasts an increase in customer LTV of 10-25% when lenders use its services, which automate every aspect of the loans process across both traditional and alternative lending. It is one of the most comprehensive tools on the market and can be integrated with existing platforms, or used as a standalone. This international company is present in over 50 countries, has large banks, telecoms giants and digital lenders as its customer base, and has won awards for its innovative, AI-powered software solutions. Interested lenders can request a live demo to see TurnKey in action.

LoanPro

Specialty: Enterprise lenders

LoanPro is an API-based lending solution for the North American marketplace, and caters to mid-level and enterprise lenders. As it is hosted by AWS it is cloud-accessible and very scalable, making it useful for businesses that may need to ramp up or down quickly. Its services include payment solutions, data management, reporting, customer service and more. This is one of the rare examples of a full service loan servicing company that offers a free trial of its software for a whole month.

Mortgage Automator

Specialty: Mortgage lending

Mortgage Automator is an end-to-end software solution for private mortgage lenders, including those in residential, commercial, and construction lending. It boasts some of the best client reviews in the market thanks to its advanced products, customizable solutions and reliable user training and support. Interested lenders can schedule a free one hour demo to see the software in action, but there is no free trial.

Repay

Specialty: Payment solutions

In the payment solutions market, Repay offers some of the most flexible options, tailored to specific industry needs. They have solutions for consumer finance, receivables management, healthcare, financial institutions and the automotive lending sectors. This is a US company operating in Canada, and it allows for web, mobile, text, telephone and in-person payment methods, as well as offering all of the back-end support to process and reconcile these payments.

AutoPal

Specialty: Financial institution lending

AutoPal is one of the best rated loan servicing solutions on the market, specifically designed for financial institutions. It services auto loans, title loans, consumer financing and more, and its functionalities are vast - ranging from complex real-time loan calculation and processing abilities, to in-depth auditing tools. There is literally no aspect of loan servicing or payment processing that AutoPal cannot handle. Interested lenders can sign up for a free trial of the cloud-based software.

LoanAssistant

Specialty: Loan amortization

LoanAssistant offers services on the bookkeeping side of the lending business, with its versatile loan amortization tool developed by accountants. This allows lenders of all stripes - including mortgage lenders, student loan holders, installment loan specialists and student lenders - to easily manage multiple loans and credit lines, and it is the only software solution of its kind that comes as an add-on with QuickBooks. A free trial is available.

The Loan Office

Specialty: Affordable solution for small lenders

The Loan Office is one of the cheaper loan servicing providers on the market, ideal for smaller companies still looking for an all-in-one servicing solution. It comes with Office and QuickBooks integration options, and relies on its ease of use to be as useful as possible to as many people as possible. Useful functionalities include built-in document scanning and unlimited user-defined fields. As this is a relatively cheap solution, there is no free trial option for interested users.

FileInvite

Specialty: Document collection

Lending necessitates a slew of documentation, and FileInvite is one of the leading providers of document collection and collation. It allows lenders to send their customers a link to a dedicated, secure portal where they can upload specific requested documents by set deadlines. It is cost-effective, and a free trial is available.

ezyCollect

Speciality: Accounts receivables

ezyCollect is a cloud-based debtor management solution for those concerned about managing the collections side of their business. With over 1,000 clients worldwide, it is a leader in this field, and automates reminders and other consumer communications, online payment processing, and more advanced debt collection procedures. A free trial of the software is available.

NuDebt

Specialty: Debt relief lenders

NuDebt’s software is an all-in-one solution for debt relief lenders, offering everything from marketing through to payment processing and legalities. It has a range of optional add-ons too, making it flexible to differing levels of need. Automated calculations and complex payment options mean it can help boost customer retention over the long term. It has no free trial available.

Choosing a Servicing Provider


When it comes to making the difficult decision of which loan servicing or payments provider is best for your company, cost and functionality will certainly be the driving forces. But there are nuances that you must consider too, and these include:

  • Is the solution compatible with different operating systems?
  • Does the solution allow for secure transfer of existing loan data from other systems?
  • Does the solution accept foreign currencies?
  • How does the software integrate updates and version changes?
  • Does the solution integrate tax and insurance functions?
  • Does the solution have a limit on the number of users?
  • Does the solution offer free, accessible technical support?
  • What security measures does the solution offer?

Frequently Asked Questions About Loan Servicing and Payment Solutions for Lenders


How much does loan servicing cost?

Loan servicing companies all charge different fees, depending on the functionality they offer and other factors. Some are relatively cheap, starting at just $25 a month, while others charge thousands in annual or per user fees. To properly understand the cost of any given loan servicing company, you need to request a quote.

What can loan servicing companies help me with?

Loan servicing companies can help with every aspect of loan management, from origination to closing, including:

  • Application processing
  • Loan origination
  • Underwriting
  • Customer communications
  • Payment solutions
  • Receivables management
  • Compliance
  • Auditing

As each provider offers different levels of service, decide what you need help with before seeking a provider.

Are there any free loan servicing options?

Yes, there so exist some open source software solutions that can help with your loan management, but it’s important to bear in mind that the reputability and reliability of these options can vary, so you should do your research before choosing a free provider. Some time-tested options include Apache Fineract, Trakker and HES Fintech. You can also get a free trial of some of the paid solutions.

What’s the downside of using loan servicing software?

Loan servicing software helps lenders with every aspect of their business, increasing revenues and efficiency, but they do so at a cost, and lenders must ensure that this cost is reasonable and affordable given their needs. There is also a risk that the chosen software might not integrate well with existing systems or be cumbersome to use, which is why researching your preferred platform before committing is so important.

Written By Smarter Loans Staff


The Smarter Loans Staff is made up of writers, researchers, journalists, business leaders and industry experts who carefully research, analyze and produce Canada's highest quality content when it comes to money matters, on behalf of Smarter Loans. While we cannot possibly name every person involved in the process, we collectively credit them as Smarter Loans Writing Staff. Our work has been featured in the Toronto Star, National Post and many other publications. Today, Smarter Loans is recognized in Canada as the go-to destination for financial education, and was named the "GPS of Fintech Lending" by the Toronto Star.