XML, or eXtensible Markup Language, is a widely-used text-based format that structures and shares data between different systems. In online loan applications, XML allows seamless data exchange between financial institutions, lending platforms, and related systems. By organizing data into a standardized format, XML ensures compatibility across various software, enabling quick and efficient data transfer. This contributes to smoother loan processing, improved accuracy, and faster decision-making for both lenders and borrowers. The use of XML also enhances data validation and security, supporting the modern needs of digital financial transactions.