Why using bank statements is important for loan decisions

  • Does the customer get paid consistently each month?
  • Is the loan repayment date within 2 days of when salaries get paid?
  • Is the cash flow consistent?
  • Is the statement legit? Check if the balances add up or if the numbers looked forged
  • Is the income on the statement within a reasonable range of what the customer says they earn?
  • Is the customer recycling cash to inflate their numbers?
  • Are inflows coming from similar names or outflows going to the same persons?
  • Are there loan payments that tally with what the customer says they owe others, or did they withhold information about their debt?
  • Are there bounced checks?
  • Check patterns of inflows and outflows. If unreasonable, something may be wrong
  • Check for destinations of payments. Are these mostly to gambling sites? Customers with gambling addictions may become overwhelmed and may struggle with loan repayments
  • Check for expenditure patterns
  • Is there a consistent spend on luxuries or items that these customers can ill afford. It points to character flaws that make people live beyond their means.

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