6 top tips for Fintechs to improve collaboration for better credit data and cost savings

6 top tips for Fintechs to improve collaboration for better credit data and cost savings

In 2022’s disrupted market, supply chain collaboration is more important than ever. However, the majority of Fintechs lack the tools, visibility and organisational structures to enable effective collaboration in bureau supply chain management.

 

Yet collaboration is key. In fact,
McKinsey
identifies collaboration and coordination across the supply chain as one of the key focuses and ways to overcome current and future supply chain challenges.

So how can you better collaborate to achieve cost savings while optimising innovation? This article explores six ways procurement, credit, and operations teams can improve collaboration and coordination for more cost-effective and resilient credit data supply.

 

Top tips on how to work together to optimise the supply chain

For any credit provider looking to improve the performance of its procurement practices, supplier collaboration can no longer be considered a nice to have. 

Here are several ways to optimise supplier relationships to gain cost-savings and gain greater value: 

 

#1: Set goals 

The first step for credit risk, operations, and procurement teams looking to collaborate more closely is to define exactly what they want to achieve and how they are going to reach these goals. 

Internal alignment and commitment of senior managers is crucial to ensure that the appropriate resources and communication channels are available. 

 

#2: Open communication channels

Successful collaboration relies on procurement teams creating a more active and engaged working relationship with suppliers. For example, when procurement teams have an open dialogue with the bureaux, they are often able to negotiate better pricing for credit
risk teams – and are first to hear of new innovations, like including BNPL or Open Banking data.

 

#3: Know the market 

It’s important for procurement teams to have knowledge of suppliers, their capabilities and emerging new trends. In addition, having knowledge of the challenges faced by operations and credit risk teams can help procurement teams to overcome these issues
when negotiating with suppliers to deliver value to the organisation. 

If Risk Managers insist that only one credit bureau is used, procurement should work with credit risk teams and other potential suppliers to encourage a broader and more effective view of the supply chain. 

 

#4: Build commercial capabilities 

Procurement teams should bring together bottom-up strategic commercial analysis as part of their continuous supplier management processes. This involves identifying opportunities, supporting them with benchmarks and highlighting these to operation teams
so that suppliers can be assessed on capability, as well as risks and commercials. 

 

#5: Get senior buy-in 

Gaining senior sponsorship when collaborating and negotiating contracts is crucial. It sends a strong message that the Fintech is serious about gaining reductions in prices when inflated pricing has been identified and will escalate negotiations to the Bureaux
senior leadership team – instead of relying on sales people exhibiting commission related behaviours. 

 

#6: Align departments 

It works exceptionally well where organisations create specific roles in the middle of the teams in order to manage the Bureaux and bridge the relationship between procurement, risk and operations.

 

The power of collaboration

Without effective collaboration and coordination, in the long-term the challenges can seriously limit the performance of the entire business, driving up costs and reducing innovation. 

Meanwhile, companies that ‌collaborate effectively can reduce credit data costs while enjoying improvements in innovation and customer satisfaction. 

 

What are your thoughts on collaboration? What challenges do you face? Or do you have any additional learnings to share

 

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