New offering helps bank partners modernize their auto lending programs through AI
Upstart, a leading artificial intelligence (AI) lending platform, today announced support for auto loans as part of its consumer lending platform. With Upstart’s new service, banks can offer refinance and purchase finance loans with a seamless digital experience, higher approvals, and potentially lower loss rates, all enabled by AI.
“Personal loans were the right first step for AI lending – now, we’re expanding to auto,” said Dave Girouard, co-founder and CEO of Upstart. “The days of randomly priced auto loans with confusing and laborious processes both for consumers and banks are nearing their end.”
Upstart’s new service eliminates the need for consumers to track down and enter their VIN or license plate number. Banks no longer need to manage detailed paperwork including title transfer, lien placement, or payoff of the borrower’s existing loan (in the case of refinance).
Upstart’s AI model for auto loans builds off its personal loan model, which has shown itself to be 5 times more predictive than FICO during the COVID-19 pandemic.* Upstart’s auto model combines a time-delimited probability of default (or prepayment) with the vehicle’s modeled residual value to generate a custom loan offer for each applicant. In addition, thanks to Upstart’s seamless digital experience, banks can achieve Net Promoter Scores (NPS) scores far higher than published benchmarks for the largest banks. The Net Promoter Scores for our bank partners’ current lending programs are approximately 80 compared with less than 30 NPS at top-tier banks.**
Features of Upstart’s Auto Lending platform include:
- Bank branded, mobile-friendly application that allows users to finish their application in one sitting
- Seamless vehicle lookup via integration with DMV records without requiring VIN or license plate from applicants
- Risk-based AI model prices customers within the bank’s credit and vehicle policy resulting in higher approvals and lower losses
- Automated fraud and verification of customer application information mean borrowers can finish their application in as little as 20 minutes
- Integrated title management including placing and releasing liens plus transferring titles
- Seamless disbursement of funds either to dealerships, the borrower, the prior lender (for refinance)