Fields as disparate as advertising, law enforcement and sports now rely on analytics to make decisions and set prices. Yet commercial lending remains an exception. According to Boston Consulting Group professionals Deepak Goyal, Sumitra Karthikeyan, Vikrant Kulkarni, Victor Noguera and Ian Wachters, a new analytics methodology could help banks capture greater profits. Aside from the authors’ error in identifying Billy Beane as the coach of the Oakland Athletics rather than the team’s general manager, their advice is flawless. getAbstract recommends this article to commercial bankers and borrowers interested in a new approach to setting lending rates and fees.
In this summary, you will learn
- Why traditional methods of setting commercial loan rates fall short,
- How banks can integrate customers’ price sensitivity into the lending process and
- How the new approach can make an impact on the bottom line.
About the Authors
Deepak Goyal et al. are professionals with the Boston Consulting Group.
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