---
title: 3 Emerging Trends in Digital Lending Solutions
description: Epic River’s digital lending solution enhances the borrower experience through a seamless process, allowing banks & credit unions to meet customer demands.
image: https://blog.epicriver.com/hubfs/Screen%20Shot%202021-07-21%20at%2011.10.27%20AM.png
---
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# 3 Emerging Trends in Digital Lending Solutions
Posted by [Jeff Grobaski](https://blog.epicriver.com/author/jeff-grobaski) | Jul 21, 2021, 11:12:02 AM
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**Digital lending** used to be a *“nice to have”* feature in the **community banking** world; now it is considered table stakes. While digital transformation was already underway with online applications, mobile banking apps, and more, the use of digital solutions skyrocketed during the COVID-19 pandemic.
These trends show no signs of slowing down, either, which means that community banks and **credit unions** need to prioritize their digital offerings to remain competitive. Otherwise, they risk losing borrowers to **financial institutions** that *meet* their expectations.
1. **Online Applications and Closings Are Common**
While COVID-19 forced loan origination to happen outside of branch locations, borrowers quickly realized the convenience of applying and closing loans from the comfort of their homes. A survey by Deloitte found that 16% of people [used online services for the first time](https://www2.deloitte.com/ch/en/pages/financial-services/articles/digitalisation-banking-online-covid-19-pandemic.html) to take out a consumer loan during the pandemic. A whopping 43% of borrowers [completed their entire mortgage application](https://themortgagereports.com/42041/mortgage-borrowers-report-increasingly-digital-experiences) online, according to The Mortgage Reports.
For commercial borrowers, the Paycheck Protection Program became an immediate need. Community financial institutions that reacted quickly served their borrowers through online portals that captured applicant data and digitally [completed their loan closing documents](https://blog.epicriver.com/automated-loan-closing-for-sba-and-the-paycheck-protection-program) with e-signatures. Both of these capabilities reduced strain on bank staff that were already in the weeds trying to meet the demand for PPP loans.
But the demand for these services will not decrease in a post-COVID world. Community banks and credit unions need to explore their options for creating an online lending experience to meet borrower expectations, going forward. These experiences include everything from online portals that allow customers to upload documentation, to [online notary services](https://blog.epicriver.com/help-your-customers-get-the-financing-they-need-with-remote-loan-transactions) that handle the entire closing process remotely.
1. **The Emergence of Non-Bank Lenders**
Along with the explosion in demand for digital lending solutions, a new threat to community banking has also emerged: the online lenders. And while these online lenders can’t compete on interest rates, they do lead with modern and convenient online platforms.
To put it bluntly, they are disrupting the banking industry. Oracle’s [Digital Demand in Retail Banking study](https://www.businessinsider.com/alternative-lending-nonbank-industry) found that over 40% of customers think nonbanks can better assist them with personal money management, and 30% of respondents -- who haven’t tried a nonbank platform -- are open to trying one. Nonbank lending options range from private lenders to working capital loans from companies like PayPal.
Without a doubt, community financial institutions still far exceed their online lender competitors when it comes to service and support for their borrowers. If they rise to the same level of digital savviness, they have an opportunity to hold their own as the preferred choice to meet borrowers’ needs.
1. **The Rise of the Gen Z**
While it used to feel like Millennials were the main focus of many industries, **Gen Z** has arrived. This group represents [20% of the labor force](https://www.forbes.com/sites/williamarruda/2018/11/13/how-to-make-your-workplace-ready-for-gen-z/?sh=5e81c86d4d30) in 2021. As they begin buying homes, starting businesses, and become decision-makers in companies where they work -- they will significantly impact the banking industry.
Yet Gen Z approaches banking differently. While banks once relied on long-term relationships with their customers; Gen Z is [willing to switch](https://www.bankingdive.com/spons/research-shows-that-over-half-of-gen-z-and-millennials-banking-relationshi/593405/) banking solutions when offered a comparable product by a tech company.
This means that community banks and credit unions cannot get complacent. Digital loan offerings must be continually examined to stay relevant for this rapidly maturing group. Banks should operate knowing that Gen Z is quickly becoming the majority customer base.
The Digital Experience Matters: Meeting the Demands for Online Lending
A common element throughout these three trends is that community financial institutions need to offer excellent, online lending solutions. Completing a clunky online application, while jumping through multiple hoops, to finish an online closing will not cut it.
A smart solution [enhances the borrower experience](https://blog.epicriver.com/notary-epic-river-enhances-both-the-banking-and-the-borrower-experience) through a seamless process while continuing to innovate the best digital offerings. . When done right, banks and credit unions meet the demands of their customers by offering unparalleled service to their borrowers.
For more information on Epic River solutions like Remote Online Notary, eSignature, and Patient Lending, [contact us](https://epicriver.com/contact-us/) today.
…
Topics: [banking opportunities](https://blog.epicriver.com/topic/banking-opportunities), [financial institutions](https://blog.epicriver.com/topic/financial-institutions)
#### Written by [Jeff Grobaski](https://blog.epicriver.com/author/jeff-grobaski)
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