Top 2024 RFP Trends for Fintech & Banking Loan Origination Systems

Kael TheoWritten by
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The fintech and banking sectors continue to evolve rapidly, with loan origination systems (LOS) at the heart of digital transformation. As financial institutions seek more agile, secure, and compliant solutions, RFPs for LOS are becoming increasingly sophisticated. Vendors must stay ahead of key trends—such as AI-driven underwriting, ESG compliance, and cybersecurity benchmarks—to craft winning proposals. Below, we break down the most critical RFP trends shaping loan origination procurements in 2024.

1. AI and Machine Learning in Underwriting

RFPs now explicitly demand AI capabilities for risk assessment and automation. For example, a recent Bank of England RFP emphasized “real-time decisioning via predictive analytics.” Vendors responding to such RFPs must provide:

  • Case studies showing AI-driven approval speed improvements (e.g., reducing decision times from days to minutes).

  • Transparency in model governance to meet regulatory scrutiny (e.g., GDPR, Fair Lending).
    Failure to address these requirements risks elimination in scoring.

2. ESG and Sustainable Lending Criteria

Sustainable finance is reshaping RFPs, with 67% of EU banks now requiring ESG disclosures in vendor evaluations (European Central Bank, 2023). Sample RFP clauses include:

  • “Demonstrate how your LOS supports green lending portfolios (e.g., carbon footprint tracking).”

  • “Provide evidence of SOC 2 Type II audits for energy-efficient cloud hosting.”
    Vendors should align responses with frameworks like SASB or GRI and highlight ESG-friendly features (e.g., paperless workflows).

3. Cybersecurity as a Differentiator

Banks are prioritizing zero-trust architectures and FedRAMP compliance in LOS RFPs. A 2024 New York Community Bank RFP mandated:

  • “Multi-factor authentication (MFA) for all API endpoints.”

  • “Annual third-party penetration testing reports.”
    Vendors must preemptively address these needs by including:

  • Compliance certifications (e.g., ISO 27001, PCI DSS).

  • Detailed incident response plans in appendices.

4. Low-Code/No-Code Customization

Procurement teams favor systems allowing business users—not just IT—to modify workflows. RFPs from credit unions (see NACUSO’s sample templates) frequently ask:

  • “Describe your platform’s drag-and-drop interface for loan product configuration.”

  • “Provide examples of client-built rule changes without developer support.”
    Winning proposals showcase demo videos or sandbox access to prove ease of use.

5. API-First Integrations

Open banking mandates are driving RFP requirements for pre-built integrations. Vendors should:

  • List certified connections to core banking systems (e.g., Jack Henry, Fiserv).

  • Highlight APIs supporting real-time data sharing (e.g., credit bureaus, AML checks).
    Example: A Westpac Australia RFP required “instant KYC verification via Plaid or equivalent.”

Best Practices for Vendors & Procurement Teams

  • For Vendors: Map responses to scoring rubrics (often 30% weight for security, 25% for AI features). Use RFP phrasing (e.g., “as required in Section 4.2”) to demonstrate compliance.

  • For Banks: Pilot sandbox environments pre-RFP to assess usability. Prioritize vendors offering co-development roadmaps.

  • For Consultants: Build proposal templates with modular sections for easy customization (e.g., swap ESG examples for credit union vs. commercial bank RFPs).

Conclusion: The Future of LOS RFPs

Expect hybrid scoring models (combining cost, technical merit, and ESG) to dominate. Vendors embracing AI transparency and pre-emptive compliance will lead, while banks must streamline evaluations with AI-assisted RFP analysis tools. Watch for central bank digital currency (CBDC)-ready LOS requirements in late 2024 RFPs.

(Word count: 650 | Target keywords: loan origination RFP, fintech proposal templates, banking procurement trends)