We have noticed a change in the loan decline market since Covid-19.
We are in unprecedented times which means the behavior of South Africans changed. I would like to provide you with some insight so you can adjust your campaigns for results.
Since the start of lock down in March we have been monitoring the feedback from clients. We also introduced a new system into our loan brokerage so we could start tracking the traffic.
When lock down started our funding partners changed their policies. Some partners will only accept companies in essential services due to risk. Other partners are accepting applications but changed their risk criteria. This has changed the loan decline market landscape. We now have people declined due to their industry and not their credit record.
From our traffic statistics we have noticed the following trends:
Salary bracket 5000-15000
Most clients that work in essential services are in this income group.
Salary bracket 15000+
There is a high percentage of people applying for loans that are in blocked industries. From the feedback received we assume that this is the reason why there has been less interest. If you think about it, a lot of these people’s income will be affected so they probably don’t have money for their debt. This is also a reason why people with high salaries are applying even though they are unemployed. According to recent news reports the high and middle class income are affected most with not being able to pay debt.
I also noticed a high percentage of declines now are business owners looking for personal loans. Even if they have good credit records they are declined due to being self employed.
*Business owners are more interested in debt relief than employees.
So as you can see the high income market with assets has shifted.
This is why there is a high rate of no interest. Your campaigns need to move with the market.
How to fix your campaigns
There is still a lot of potential business for the debt industry in this market. But to find clients now you are going to have to make your pitch more relevant. You will need to have a different type of pitch for each type of client in the market.
We are in uncharted territory but we do know that everyone is taking a financial knock. Not everyone you speak to may be ready now but you need to establish the relationship so they come to you when they are.
Build a pipeline of leads- it’s very important for future sales. I learnt this two decades of sales and it’s the best advice I can share with you.
Declined loan client profiles
1. Blocked due to industry
These clients cannot apply for a loan because their employers are blocked. There will be over-indebted consumers that are taking pay cuts. You will also find people looking for loans that are not over-committed but need short-term cash relief.
2. Self employed
You will find business owners with good credit records declined due to employment type. You will also have business owners with cash flow problems that need help.
3. Poor credit status
The clients that apply for loans to supplement their income. These are the ideal clients but most difficult to convert. They are stuck in the consumer debt cycle. They will be searching for more loans.
If you can understand who you are speaking to, you can design a sales strategy for each client type. This will help you to be more relevant so you can break down the trust barrier.
Being relevant to your audience is the key to sales. One way that you can identify who you are speaking to is to ask the clients why they applied for a loan. You can also ask them if they are self employed or employed to find out their employment terms.
A business owner will have different stress and concerns to someone employed. Learn to use the information you have to be more relevant with your conversation.
Loan decline data sales
We generate loan traffic through our websites that generates our loan decline data. When you buy the data from us you are buying a loan “audience” or “market”. You are renting data records from us to find suitable clients for your business.
It is impossible for us to guarantee your sales from data. We are selling you data records but we do not know the people or their needs. For us to be able to guarantee you sales we would need to speak to every single record before we send them to you. This would be a completely separate task and would cost a lot more than R1 per lead to generate. As a business owner I am sure you can understand the logic behind this. You pay for time and cost involved in a transaction.
The data we provide is the raw data that you would use to run your own in house lead generation campaigns. The purpose is to provide you with access to the market and the opportunity to generate exclusive leads at a lower cost.
I hope this provides more insight into the loan market. As the economy changes, the market will move and we will keep you updated with new trends.
Please do reach out to firstname.lastname@example.org if you want to discuss your marketing needs.