Journey To Inhouse Loan Management System

Every lending company experimenting with new products regularly should try to keep their LMS in-house. Due to many advantages:-


Having in-house LMS brings itself a lot of flexibility when it comes to building a new product. We are free to decide completely on our own the product specifications without involving any 3rd vendor to tell us what they can and can’t provide. Who would be accessing requirements based on its larger system providing the same service to a large number of customers. Conflict of interest might also arise sometimes.

Cost Saving:-

In-housing something may save or increase cost, based on your usage, if your usage is very low you might end up spending more in development. But if your usage is considerable you will definitely save a lot of money and this is the cost for any lending company. This could be even more significant if you use some open-source software.


This might not exactly be the issue if you are using some big provider, but still, someone else has access to all your data, and if you took service from some new company, this could be a real issue. This point should be considered very serious as it has various long-lasting impacts.


With an in-house system, you know each and everything happening in the system, each and every calculation, which might not be the case when outsourcing. There will be several times when you will need to know exactly how calculations are happening to explain to internal and external auditors, RBI, and most importantly customers themselves many times, etc.


You are the owner of the product and you can modify and design as you desire without any restrictions from the capabilities of some 3rd party vendor. It’s your own ground to do and try anything and everything as you desire.


You can explore different types of products from prototyping to MVP to final product. As you desire and scratch it if required without the issue of any contracts being signed.


This might sound weird but when exploring with your in-house system you can come to learn a lot of things and come up with ideas that might help in the development of a new product or improvement of some existing product.

Points to consider when designing LMS:-


This should be the biggest point to consider when designing an in-house loan management system since all your transaction data will reside on this. Any issue here could have some serious impact on your organization’s reputation and customer trust. Which is something very hard to gain but very easy to lose.


It should scale perfectly with your business. Since you would definitely be scaling your business, you wouldn’t be having book size year after year, you would definitely want that to increase and your system must be able to support that increase.



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Shivam Agrawal

Shivam Agrawal

Hardcore polyglot coder and enthusiastic learner. Always looking out for opportunities to learn and develop new skills. (