Most funders and portfolio managers have already worked out that operational overhead is a problem. What holds them back from doing anything about it is usually a handful of assumptions about outsourcing itself, most of which don’t hold up once you look at how a modular model actually works.
“The upfront cost is too high”
This one’s a fair point for an early-stage book. A full enterprise servicing model isn’t the right starting point when a portfolio is still finding its shape. That’s why VLS doesn’t insist on it. A readiness review or a launch/ramp structure lets a funder start small and step into full servicing as the book scales, rather than paying for infrastructure the portfolio isn’t yet big enough to justify.
“You can’t integrate with our origination platform”
VLS isn’t replacing anyone’s origination platform. Funders continue to originate and document cases exactly as they do now. What changes is what happens next: a controlled boarding process moves each case from activation into servicing, so the two systems work alongside each other rather than competing for the same job.
“Can you migrate our current book?”
Not currently. VLS is best suited for new books, new product lines, new funding structures, and ring-fenced lending programmes from day one. If a funder is looking to migrate an existing book, this isn’t the right fit.
“We’re not ready yet”
That’s exactly why the readiness review exists. Rather than guessing at what a full servicing model would require, the review sets out precisely what needs to be in place before a funder commits to one, so “not ready” becomes a plan rather than a reason to wait.
“We may build this ourselves”
At scale, that can be the right call. The real question is whether it’s cost-effective to hire, train, control and govern an operations function before the book has proven itself. Building in-house means absorbing the recruitment risk, the training burden, and the compliance resourcing before there’s volume to justify any of it. A modular model enables that decision to be made later, once the portfolio has the data to support it.
These objections are right to be raised. They’re the right questions for any funder weighing up outsourcing versus building in-house. The answer isn’t to dismiss them, it’s to show where a modular structure already has answers built in, so the objections don’t block your decision.
Find out how VLS’s Modular Outsourced Operations can meet a book wherever it’s at. Speak to our team today to get started.
