The Lokta lending glossary
A glossary of loan servicing, collections and loan management terms: the vocabulary of the post-approval book, from the industry's standing terms (LMS, LOS, LSP, loan servicing, co-lending) to the words we use for the architecture behind the agentic loan servicing platform (deterministic core, audit-by-design, agent-native). Every entry opens with a one-sentence definition and has a page of its own, so a term can be linked and cited alone.
Industry vocabulary
Industry vocabulary
- Loan Management System (LMS)
A Loan Management System (LMS) is the system of record for the post-disbursal life of a loan: schedules, repayments, interest accrual, charges, NPA classification, restructuring, write-offs, and the audit log behind every change.
- LMS RFP (Loan Management System RFP)
An LMS RFP (Loan Management System request for proposal) is how a lender evaluates and selects an LMS vendor: scoping requirements, scoring responses, and stress-testing servicing, collections, accounting, audit, security, and AI governance before committing.
- Loan Origination System (LOS)
A Loan Origination System (LOS) is the system that takes a borrower from application to first disbursement: lead capture, KYC, credit decisioning, document collection, agreement generation, and funding.
- Loan servicing
Loan servicing is the work of running a loan after the money is disbursed: collecting repayments, applying them to interest, principal and charges, keeping the schedule and balance current, answering the borrower, watching for early signs of stress, and following up on missed payments until the loan is closed.
- Loan servicing agent (AI loan servicing agent)
A loan servicing agent is software that does servicing work on a live loan for the lender: it reads the account, decides the next step within policy, takes a governed action such as a reminder, a payment-plan offer or an escalation, and records every step.
- Lending Service Provider (LSP)
A Lending Service Provider (LSP) is an agent a bank or NBFC appoints to carry out lending work on its behalf, while the lender stays accountable for it.
- Co-lending
Co-lending is an arrangement where two or more lenders fund the same loan in a fixed ratio, sharing risk and return on a per-loan basis.
- Connected lending
Connected lending is the architectural pattern where origination, loan management, collections, and agentic servicing run on a single data ontology, a single ledger, and a single audit log, instead of being stitched together from separately purchased systems.
- Apache Fineract vs Mifos X (Apache Fineract)
Apache Fineract is the open-source lending and core banking platform maintained by the Apache Software Foundation, and Mifos X is the platform it grew out of: the Mifos Initiative’s second-generation system, whose backend was donated to the ASF in 2015 and became Fineract. Today Mifos X names the distribution that bundles Fineract with web and mobile apps and reporting.
Lokta concept vocabulary
- Lending ontology
A lending ontology is one canonical model of the loan (borrower, application, repayment, and risk, plus the relationships between them) that the whole lending stack reads and writes through, instead of a separate copy of the loan in every system.
- Agent-native lending (Agent-native lending platform)
An agent-native lending platform is a lending core built to be operated by agents (software that reads the loan, decides, and acts) rather than by people clicking through screens. Every layer assumes an agent, not a human, is at the controls, and is governed accordingly.
- Deterministic core
A deterministic core is the layer of a lending platform whose outputs are fully reproducible from inputs and policy: no probabilistic models, no LLM calls, no hidden randomness.
- Workflow AI vs agentic AI
Workflow AI assists a human inside an existing process; agentic AI runs the multistep process end-to-end. Both sit above a deterministic core; neither substitutes for it.
- Audit-by-design
Audit-by-design is the principle that every decision a lending platform makes (human, workflow AI, or agent) produces a tamper-evident record that a regulator or internal auditor can replay.
- AI-ready LMS
An AI-ready LMS is a loan management system whose data model, APIs, and policy engine were designed for AI workflows and agents to read and write, not merely for screens and batch jobs.
- Strategic-liability LMS
A strategic-liability LMS is a loan management system whose architecture, contract terms, and vendor relationship together prevent the lender from making the product, compliance, and exit decisions a board would otherwise expect to make.
- Agentic loan servicing
Agentic loan servicing is the operating model where AI agents run multistep servicing workflows end to end (collections triage, dunning sequences, hardship handling, complaint resolution, KYC re-verification) under explicit policy guardrails, with every action logged for audit.
See a term we should add, or a definition that needs sharpening?Tell us. The glossary is editorially maintained, not generated.