Marketing management assignment on: Client management
How to gather of information when establishing the client’s complex lending requirements??
Solution:
It can be seen that the required information has been gathered when establishing the client’s complex lending requirements through the following ways such as Open questions, Listening skills and the fact find. It has been analyzed that generally the customer requirements are generally met by executing the fact find with the various clients. This is in the form of questionnaire and then saved as the client’s records. The fact find includes numerous details about the clients such as personal information, income, employment, assets, future and existing needs, experience and knowledge of investment and risk attitudes. In general personal and family details tells about birth place, address, domicile for purpose of tax, family details, marital status, trusts and wills. The detail of the employment about the clients helps in knowing that the clients are self employed or not. On the other side, expenditure and income tells about income source, regularity of income and income purpose (Bent, 2006). Liabilities help in knowing balance outstanding, loan amount, interest rate, repayment method and lender. Open questions are excellent for exploring feeling and attitudes of the client and information expanding. It is crucial for advisors to recognize clients tick and form feelings and attitudes which shows that implementation of open ended questions is mandatory. In general listening concentrates on what the clients are saying and the purpose behind it and make sure that the message is responding and understood by the client properly. Acknowledgement might be offered non verbally by smiling and nodding etc. At last, the advisor needs a numerous skills for gaining the confidence of the client and assists him to take various actions such as listening skills, questioning skills and communication skills (Nutt, 2004)
Another question deals with how to record and document the interaction with clients.
In general, there are various ways for recording of interaction with clients such as recording of call and conference. In this report, clients have been chosen as students who want loan for the higher education.
Call recording: It has been observed that recording of the call, pinpointed the conversation that the advisor wants to record about the client on clicking of record button. It has been analyzed that recording of the call helps the advisor to know about the client well in future also (Bent, 2006). Call recording helps the advisor to know about the students very well and recognize the student with its voice.
Conferencing: During the interaction with the client, it is appropriate to make conference calls. In general, conference window helps in managing of conference call. For starting the session of the conference it is important to dial first telephone no. of the participant. On clicking of conference button then dialog box of conference will open. From the list of the interaction, drag the next participant in the conference window. To disconnect the participant from the conference call, highlighting of the participant that the advisor wants to reject and click on the disconnect button. In general, conferencing helps the advisor to know about the various students at the single time and their viewpoints about the student education loan (Cortada, 2005)
Considering of complex broking solutions based on the client’s needs
Smart Option Student loan This loan is basically designed for the students who want to study abroad. The various opportunities are there for the students such as to enjoy competitive rate of interest and no any kind of origination fees. In general, situation of the students at the time of school and college, they are generally dependant on parents so after that this loan offers the chance to students to make timely payments on the time during the school. Financial issues can be there if the student does not pay the loan on the time and left the studies in between. The student’s eligibility can be checked with their qualifications and parents condition. This loan helps the students in availing of degree from the institutions (Nutt, 2004). It has been analyzed three opportunities are there in the case of this loan such as Interest repayment, deferred payment and fixed payment. This loan provides the opportunity to the students to balance the budget and achieve the goals on the time. This loan is specifically designed for the students who want to have higher degree from the institution. This loan offers various objectives for schemes of student loan which will influence the operation and design of the loan scheme such as budgetary objectives, facilitating the diversification of the higher education, social objective, meeting particular needs of the manpower and easing financial burdens of the student.
Risk managing tools
There are some ways to manage the risk when dealing with clients, who have complex loan requirements such as Menu Approach, Psychometric Approach and Portfolio Approach (Mango, 2010)
Menu Approach It has been analyzed that the advisor explains risk tolerance categories and then ask from the clients where they experience and fit in. It can be seen that the result of the interview approach is dependent on advisor skill and clients understanding. The advisor can persuade the clients through emphasis and the client may curious to answer the way that the advisor could expect.
Psychometric Approach: It has been analyzed that normally the clients implements techniques for assessing the psychological attitude of the client to risk and client’s capability to cope with the risk of finance. This test helps in assessing of the knowledge personality and attitudes of the client as compared to how much the client has prepared for managing the risk. This approach includes client attitudes towards the risk and the financial decisions in the past that the client has made (Bent, 2006).
Portfolio Approach: the advisor views the client numerous portfolios comprising of different investments, defined merely as low return, low risk, average return, average risk, high return and high risk. The chosen portfolio by the client gives an idea to risk attitude and shall offer a foundation through which advisor may decide asset allocation (Cortada, 2005)
Apart from this, there is a process for risk identification.
The first step is related to undertaking of risk identification and assessing of risks.
The second step is to find out complex options of the broking which includes submission of complex file of client loan using in-house documentation.
The third step is related to third party signature testimonial which includes work history of last five years.
Another question is related to presenting of the loan options to the client.
Smart Option Student Loan
This loan helps the client to select from three repayment alternatives and designed to balance the budget and the goals.
This loan gives the client to enjoy competitive rate of interest and no any kind of origination fees.
This loan provides the opportunity to the client to make scheduled payments on the time during the school (Bent, 2006).
This loan covers 5000 tuition lost because of medical withdrawal and student can take up to 100% school certified education cost.
Benefits
The students can have advantage of interest repayment which means that students can pay interest during school and have smaller period of repayment after the school and save over 20% on the entire cost of the loan as compared to the deferred option of the repayment ( Dorfman, 2007)
The students can have advantage of deferred payment which indicated that students are not required to pay any amount during the school as much as students like for achieving of maximum flexibility.
This type of loan offers competitive rate of interest and rates arise from LIBOR + 2% to LIBOR+ 9.88%. No any kind of origination fees is there and no any prepayment penalties (Sack & Juris, 2007)
The students can have rewards due to payment of loan on time such as get 2% smart reward in upromise account and make payments timely during the school. Another benefit is student get 0.25% reduction of interest rate while making timely payments by the automatic debit (Walton, 1977)
Another benefit is students can have benefit of insurance and have mind peace for the investment in the higher education specifically due to this loan. This loan offers no any cost to students with loan disbursed among 1st July and 31 Oct.
It has been analyzed that if the student applies through a creditworthy cosigner then in this case he may receive a lower rate of interest. Students can avail 0.25% reduction in interest rate due to timely payments through automatic debit.
It has been analyzed that the students can choose the option of the repayment which works for the students who are in school and defer all payments and interest. No any prepayment penalty is there, in spite of repayment plan (Neil, 1986).
At last this option has been offered to the students because this loan helps the students in balancing of the budget and achieving of the goals.
The last question is related to answering of the client concern before presenting the loan options to the client
It has been analyzed that the students asked so many questions before viewing of the smart alternative student loan such as
What can be the rate of interest charged for the smart option loan?
What can be the repayment period 1 year or 6 months after having job whichever is earliest?
What can be the eligibility for getting of education loan?
What does the individual must look in deciding of the loan.
On which professional courses banks generally offer education loan.
In order to solve the queries of the client the advisor has hired consultants to deal with the students queries related to the education loan. The advisors have provided adequate training to consultants to deal with the issues of the student. The consultants have proper information about all queries related to education loan such as repayment period, rate of interest, rewards and other benefits (Yip, 1989)Conclusion
This report has provided the brief overview about the client’s complex lending requirements which provides explanation of the services to the client. The fact find comprises numerous details about the clients like personal information, income, employment, assets, future and existing needs, experience and knowledge of investment and risk attitudes. This report offers the valuable insight how to record and document the interaction with the client. This report also provides the overview how to manage the risk when dealing with the clients who have complex loan requirements. An example of student option student loan has been highlighted with its advantages and conditions. Advantages and financial implications of student loan have been highlighted. The analysis of the client situation has been done in order to determine the opportunities and constraints. The assessment of various options has been done in order to achieve the client’s objective. This report also considers the complex broking solutions based on the needs of the client. At last concerns have been identified while presenting loan options to the client.
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