Credit & Risk

A change in how you lend, will do you (and your members) good

Zest AI team
December 5, 2022

Change is a popular theme — from Sheryl Crow, David Bowie, to philosophers, activists, and dreamers. Change presents opportunities to make things better.

And when it comes to lending, there's no denying that there is much to be desired from traditional, national score underwriting methodologies — from a lack of efficiency to inherent biases.  What if changing your underwriting process was not only possible, but made your lending decisions smart, inclusive, and efficient?

Improve your decision accuracy and change how you lend

Let’s take a closer look at the decisioning process. Credit application decisions fall into one of three, simple buckets:

  1. An application you can auto-approve.
  2. An application you can auto-decline.
  3. An application you manually process.

But we all know it's not that simple when it comes to which bucket loan applications will fall into. Credit unions don't feel always comfortable auto-declining applications based off of industry score results... maybe because they're not certain on the accuracy of the industry score. Credit union professionals know that two applicants with the same industry scores don’t necessarily represent the same level of risk because the industry score fails to take the right data points under consideration, even today.

So when the vast majority of credit applications you receive invariably fall in that gray area for manual review — you've got a lot of work on your hands. But if you could trust the accuracy of the insights you gained about borrower risk, do you think you could improve the efficiency of your lending process?

Changing how you lend means a lot to your members

Improving your decision accuracy can change the whole game for a credit union.

This improvement can be brought about through the use of AI-automated underwriting technology, which delivers fair, accurate insights about borrower risk to your underwriters in seconds, giving them the information they need to make a speedy decision on a loan they're manually reviewing. And whether your auto-approving or auto-denying loans, members appreciate quick answers, especially when they know they're being made fairly.

When 74 percent of consumers expect their loan decision to take less than a minute, this kind of efficiency can help strengthen your relationship with your members.

Changing how you lend can mean a lot to your credit union

We can't forget the benefit that AI-automated underwriting can bring to your organization.

Underwriters spend less time manually reviewing applications because they can trust they accuracy of the technology you're using. With that extra time resource, they can spend more time connecting with members, advising them on building their wealth, and helping folks who may have fallen through the cracks.

And as for operational expenses — what kind of savings could AI-automated underwriting get you if you could auto-decision 80 percent of your members? With Zest AI, our credit union partners save up to 67 percent of time and resources in their lending processes, and some even have their eyes set on the goal of automating all of their lending in the near future.

While the times they are-a changin’, credit unions working with Zest AI have the power to lead that change to better serve their members.

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