How Wells Fargo launched online loans in 9 months


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How Wells Fargo launched online loans in 9 months
On May 10th, 2016, Wells Fargo announced the launch of FastFlex Small Business Loans. The company is pitching FastFlex as “an online, fast-decision loan" that can be funded as quickly as the next business day with a competitive interest rate to small businesses with short-term credit needs. Though incumbents might not have seemed as flashy as some of the marketplace lenders, LendingClub’s recent financial snafu is making Wells Fargo, with its brick and mortar branches and its sturdy legendary wagon, seem like an attractive alternative. However, Wells Fargo has more than just the marketplace lending crisis to recommend it to small businesses; the bank has built up a sizable community of 3 million small business owners that use its services, and provides more loans to small businesses than any other bank in America. As Amy Feldman wrote in Forbes, FastFlex “is part of a broader push to attract entrepreneurs of all sizes,” and indeed, in 2014, the bank set a $100 billion lending goal for small businesses, and it's already issued over $40 billion of new loans. Wells Fargo has utilized the internet to develop its relationships with small business owners before; in 2014, it launched Wells Fargo Works for Small Business, a holistic platform that guides small business owners to financial security and success. However, FastFlex is the small business department’s first foray into cutting-edge technology, and the team has high hopes for this union: “We are innovating to fuse the largest retail distribution channel in the United States with industry-leading digital offerings to create an exceptional customer experience,” says Jim Seitz, Wells Fargo’s Small Business Communications Manager.

Transformative product requires company-wide transformation

Beta-testers have already expressed satisfaction with the product, citing the simplicity and speed of loan issuance. However, the behind-the-scenes cross-departmental cooperation that went into creating FastFlex suggests that the service will be just as transformative to Wells Fargo as an organization as it will be for its small business customers. Though it was created entirely within the current business organization, more than 50 team members from a number of areas within Wells Fargo were involved in creating FastFlex. Given other organizational responsibilities, most of this group did not work full-time on FastFlex throughout its development. Three team members from Wells Fargo’s Business Direct team – a team that provides small business loans under $100,000 each – led design of the product. In addition to the Business Direct Term Lending Product team, the cross-functional team that worked on FastFlex included team members from systems, operations, marketing, credit risk, compliance, legal, digital and Wells' Innovation Group. The fact that FastFlex is a product of so many different people coming together, coupled with the fact that the entire process was conceived and constructed in-house in just 9 months, demonstrates the impact that the drive towards technological innovation has had on Wells Fargo as a whole.

Heads down and innovating

Other financial institutions seem to be driving fintech innovation not out of choice but out of necessity. Takes Charles Schwab, for example. Like Wells Fargo, online broker Schwab was facing some competition from pesky startups. Instead of choosing to ignore the roboadvisor trend or to partner with a startup, in 2014, Schwab came out with its own roboadvisor called Schwab Intelligent Portfolios and, like Wells Fargo, developed its service quickly, rolling it out just 6 months after project kickoff. Seitz couldn’t speculate on whether Wells Fargo would be replicating FastFlex's online, fast decision loan model across its different departments. Nevertheless, it seems likely that if the service is as successful as the team hopes it will be, we’ll soon see similar services popping up throughout Wells Fargo. Photo credit: JeepersMedia via Visual Hunt / CC BY

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