To check whether financing has been provided correctly, financial institutions have made due diligence an essential part of the procedure. It ensures a correct and prudent provision of mortgages and other loans. During this process, a variety of documents and data from different sources are checked.
Due diligence is essential to a good risk framework. But since it’s often too time-consuming for financial institutions to perform it, more and more parties decide to outsource the process to independent expert parties such as Fortrum.
Fortrum provides financial institutions with support on due diligence and aims to grow its business. To ensure more consistent services and thus guarantee the quality of its current due diligence services, Fortrum was looking for a new, stable workflow and registration tool —one that can also be used to respond flexibly to increasingly strict due diligence requirements.
Fortrum is an expert on consultancy, due diligence, academy and research for the financial services industry. It’s common to check a financial institution’s credit file for due diligence. That means a thorough check is performed to ensure the applicable conditions and procedures associated with the granting of this credit are met. Fortrum provides both 24-hour checks and checks on one-off large portfolios.
The Dutch company, which operates in several countries, distinguishes itself by providing high-quality advice to large banks, investment banks, and mortgage lenders. This market is expected to grow considerably in the coming years. To improve its performance and scale up effortlessly, Fortrum required a completely renewed application.
Understanding, simplifying, and standardizing work processes
Due diligence involves numerous relevant processes, checks, tasks, transactions, people, and responsibilities. It’s a complex matter that requires meticulousness and a standard working method.
For the first prototype of the Fortapp application, PAQT thoroughly analyzed and mapped the entire mortgage process. We investigated what is really required and how the process can be improved and standardized. One result is that an employee is guided through the process with more ease now, so a project is always created in the same way.
“Simplification and standardization have ensured the consistency of our procedure,” says Jaap van Raak, director at Fortrum. “As a result, our services are scalable — and we avoid the risk of this causing errors in the long term. At the same time, Fortapp is flexible enough to offer every customer a custom solution. This enables us to grow in the way we want to, which makes us very happy.”
From reporting to monitoring
Fortapp is used for reading in data tapes and reviewing files, but also for lender and servicer reviews. Projects are easier to set up, and it’s possible to read in data tapes in ESMA format, for example, in one go.
As a result, Fortrum can focus on what truly matters: due diligence on portfolios, lenders, and servicers. So, Fortrum’s clients are always demonstrably in control and compliant. This provides certainty, which is crucial in today’s financial world.
Roles, rights, and reports
Fortapp comes with two main roles for users in the organization: ‘Admin’ and ‘Employee.’ Depending on a project, roles such as Junior, Intermediate, Senior, Project Lead, Team Lead, and Director can be added at the Employee level. So, it’s possible to put together a custom team, in which case it will be clear who has which rights and who can check which employee. This contributes to transparency and improves the quality of collaboration (in a simple manner).
The due diligence process consists of a huge series of questions and checks that need to be answered. It is simplified and standardized by allowing only three answers: ‘Yes,’ ‘No,’ and ‘Not applicable.’ Every ‘No’ requires action and is automatically included in a final or intermediate report with predefined descriptions. The report should be exported. This approach ensures a clearer work process for the user and qualitative reports for the customer.
High security requirements
The application complies with ISO 27001 standards and the strict requirements set by financial institutions, and — considering the GDPR — it’s been developed with ‘privacy by design’ in mind. For example, client data should be physically and virtually separated from other client data. This is continuously verified through multiple checks and automated tests.
Passwords are encrypted when they’re stored, among other things, and they can be used for a maximum of 90 days (the last nine passwords used are remembered to rule out repetition). The application also uses 2-factor authentication. Plus, data encryption occurs fully automatically via MySQL.
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Platform improves and accelerates processes
During the first stage of the assignment, Fortrum’s old application was replaced by a new software solution for importing, processing, reviewing, and reporting mortgage files. The next two stages will consist of adding extra functionalities to Fortapp, such as more reports, notifications, an activity log, and a management dashboard.
The application has been developed based on a platform philosophy so it will be possible to work with API connections in the future, thus further improving and accelerating ongoing due diligence processes in particular. In the long term, a platform will also allow for involving stakeholders outside Fortrum to foster an even more efficient collaboration.
With Fortapp, everything is aimed at increasing the quality of due diligence, reducing lead times, and facilitating collaboration. That is how Fortrum makes the difference in the financial sector as an independent expert.
- Streamlined, clear due diligence
- Continuous monitoring
- Workload overview per employee
- Also suitable to use internationally
Security & privacy
- Fully separated client data
- MySQL server with Enterprise Encryption
- Multifactor authentication