Meet The Lending Finalists For The 2021 Innovation Series

This year’s solutions allow credit unions to lend to more members with less risk and more efficiency.

Welcome to the fourth annual Innovation Series presented by CreditUnions.com. Every year, this series showcases how creative companies are helping to transform the credit union industry.

Read about the finalists by clicking on the links below.

SU NING STRUBE, JUDI.AI MATT ROE, OPEN LENDING PAUL KATZ, PROMONTORY MORTGAGE STEVE MUSZYNSKI, SPLASH FINANCIAL

This year, CreditUnions.com is spotlighting innovations in three categories Mobile, Lending, and Member Experience with entrants that represent a diverse group of longtime suppliers and startups, each with a compelling story to share about how credit unions can take service and technology to the next level.

The staff at CreditUnions.com looks forward to hosting the Innovation Series every year because we give the industry the power to choose our winners. Do your part today by reading about the finalists below. Then, watch the webinar and vote on your favorite.

LENDING: JUDI.AI

Su Ning Strube, Chief Product Officer, JUDI.AI

Please describe your innovation.

Su Ning Strube: JUDI is a small business lending analytics platform uniquely designed for credit union lending ecosystems. Driven by powerful AI and machine learning technology, this industry-leading platform enables credit unions to perform instant cash flow analysis, drive automated underwriting, and provide continuous loan portfolio monitoring.

With smarter lending analytics from JUDI, credit unions can quickly assess the financial health of their small-business members and actively grow relationships by providing the critical credit assistance and advice small-business members need in a more timely, less risky manner.

What opportunities or challenges does your innovation address?

SNS: Small-business relationships power our communities. Given the current state of our economic environment, it’s prime time for credit unions to re-examine how they can provide the best support possible to small businesses without undertaking an unhealthy amount of risk.

A big part of this is aligning product and advice offerings that support member needs in an efficient, cost-effective way. Key challenges JUDI is actively helping our credit union clients overcome include:

  • Digitally transforming the SMB lending process This includes automating underwriting functions, streamlining cash flow analysis, and continuously monitoring loan portfolio performance.
  • Keeping risk low and credit models current This involves increasing the quality and volume of data points that can be ingested and applying AI algorithms and machine learning models that can easily adapt.
  • Managing evolving loan portfolios in real-time This means instantly analyzing cash flow data, categorizing financial transactions in seconds, automating credit decisioning, and supporting self-service origination processes.
  • Providing smart post-lending analytics This relates to timely touch points and advice designed to help SMBs navigate the current economic environment and help credit unions grow member relationships.

How does your innovation increase member value for client credit unions?

SNS: Re-thinking small-business lending is an opportunity for credit unions to grow relationships and communities. Smart analytics translate into more-valuable touchpoints. If JUDI can provide the timely insights credit unions need to help small businesses succeed, there is a better chance of increasing loyalty, which translates into increased wallet share, repeat business, and a trusted business recommendation throughout the community.

What differentiates your innovation from competitors?

SNS: JUDI.AI is different to the core our values of fairness, collaboration, diversity, and innovation are inherent to every relationship we form. Our relationships with credit unions such as Vancity, DUCA, and Sudbury Credit Union are good examples of how we love to work out visionary roadmaps and how we nurture each relationship.

In terms of technology differentiators, we have those, too. Our flexible AI algorithms and machine learning models are unique to the JUDI platform to date, we have ingested more than 10 million data points. Ease of implementation comes with the fintech territory, but the ability to claim credit science based on more than $1 billion in loan applications adjudicated is something worth a discussion.

We understand the complexities around SMB lending and that no single factor in isolation can identify the financial health of a business. JUDI can help credit unions make these hard decisions by providing instant insights so our clients can say yes more often to small-business borrowers.

Watch the lending finalists for the 2021 Innovation Series talk about their solutions. Register today. Voting opens after the webinar.

REGISTER ToDAY

LENDING: OPEN LENDING

Matt Roe, Chief Revenue Officer, Open Lending

Please describe your innovation.

Matt Roe: Lenders Protection is a unique auto lending enablement platform that uses proprietary data and advanced decisioning analytics to provide lenders with a safe, powerful way to increase near- and non-prime auto loan volumes that achieve higher yields without adding significant risk.

Combining more than 20 years of loan performance data with alternative data results ensures incredible 99.2% accuracy in predicting default frequencies in non-prime auto lending. The result is a profitable auto loan portfolio with carefully managed pricing and risk characteristics.

What opportunities or challenges does your innovation address?

MR: Much of a financial institution’s automotive loan application flow results in lost opportunities due to less-than-favorable counteroffers or denials. The Lenders Protection program increases opportunities that enhance existing application flow. Lenders Protection allows an institution to expand its loan offerings with lower credit scores (560 minimum), higher loan advances (up to 145% of wholesale/trade values), longer loan terms (up to 78 months), and competitive interest rates that result in more-affordable loan payments.

How does your innovation increase member value for client credit unions?

MR: Lenders Protection’s goal is to allow our financial institutions to book 20%-30% more automotive loans from their existing application flow. Typically, the non-prime member might seek financing from a dealer or predatory lender and receive a loan with unfavorable terms. Lenders Protection empowers credit unions to serve more of the underserved population by offering attractive loan terms that allow members to get appropriately priced financing based on their unique risk profile.

What differentiates your innovation from competitors?

MR: The Lenders Protection platform is interfaced into most point-of-sale and loan origination systems. This means the loan and the insurance process is delivered seamlessly through our program’s proprietary software, eliminating the need to re-key application information. Through our pricing tool, financial institutions customize their yield targets and operating costs, resulting in the lowest interest rate possible for each loan, achieving the financial institution’s goal to serve more members.

Watch the lending finalists for the 2021 Innovation Series talk about their solutions. Register today. Voting opens after the webinar.

REGISTER ToDAY

LENDING: PROMONTORY MORTGAGEPATH

Paul Katz, Managing Director, Promontory MortgagePath

Please describe your innovation.

Paul Katz: Promontory MortgagePath (PMP) delivers a modern and flexible set of mortgage fulfillment solutions unique in the market. PMP’s proprietary point-of-sale technology, Borrower Wallet , is redefining the lending experience by offering functionality specifically designed to improve efficiency and create a superior user experience, which includes:

  • Automated document collection and secure digital portal. An intuitive, user-tested and easy-to-navigate platform, featuring real-time status updates and in-app education features.
  • A unique dashboard enabling loan officers to track loans and actions in real time, in one place without the need for system-jumping.
  • Dynamic collaboration empowering loan officers to build better relationships with members directly in the app and co-pilot applications Detailed productivity reporting and at-a-glance loan monitoring to easily track loan movement, volume, and quality day to day, month to month; and year to year.

PMP’s seasoned operations professionals function as extensions of a client’s team, giving credit unions the benefit of full-time fulfillment staff without the added employee expense. PMP’s digital mortgage fulfillment solutions maintain strict compliance adherence by employing multi-dimensional security controls, utilizing tech, operational, and employee-driven methods to comply with evolving data-protection regulations and industry-specific compliance requirements.

PMP has also developed Transform, a new service delivery model bundling licensed loan coordinators with the Borrower Wallet POS platform and PMP’s mortgage fulfillment services to offer a complete mortgage operations platform from application to close. With Transform, credit unions can cost-effectively offer mortgage services to their members without adding full-time sales or operations staff.

What opportunities or challenges does your innovation address?

PK: While 2021’s projected origination totals won’t be as robust as what was achieved in 2020, there is still tremendous opportunity to be had, with estimates falling somewhere between $2.5 – $2.7 trillion for the year. However, this opportunity does not come without a cost. In 2019 (the most recent year for which this data is available), the average cost to originate a loan for community lenders was $8,030, with non-sales production expenses (i.e. fulfillment, production support, and corporate administration) accounting for just over half of that total.

In the cost-to-originate equation (i.e. sales v. non-sales expenses), the majority of fixed costs and, therefore, the largest opportunity for cost reduction lies in non-sales expenses. For example, fulfillment expenses alone accounted for nearly a quarter of community lenders’ per-loan cost to originate in 2019.

By addressing non-sales expenses with an eye toward both cost reduction and increased efficiency, community lenders can not only take advantage of the current mortgage explosion but also set themselves up nicely for long-term lending success. This is where Promontory MortgagePath can help.

Community lenders that have utilized Borrower Wallet in conjunction with Promontory MortgagePath’s mortgage fulfillment services have experienced:

  • A 75% increase in the average number of loan applications taken per month, with month-over-month increases reaching as high as 255%;.
  • A 13% reduction in the number of days from application to closing.
  • A 60% decrease in investor delivery cycle times.

How does your innovation increase member value for client credit unions?

PK: Credit unions hold a unique role in the financial services ecosystem. The membership model establishes a dynamic between the institution and individual that encourages the development of a long-term relationship. The role of the credit union in this relationship is to enable its membership to establish a solid financial foundation upon which to build their financial futures, and homeownership and, by extension, mortgages play a key role in this process. According to the Federal Reserve’s Survey of Consumer Finances, homeowners possess a median net worth of $255,000 compared to $6,300 for renters, thus making homeownership a critical factor in the ability to build wealth.

What differentiates your innovation from competitors?

PK: There are companies that provide mortgage fulfillment services or a point-of-sale platform. Yet, there are very few, if any, that are specifically designed to support community lenders. In addition, PMP’s operations are 100%-based in the United States, whereas many competitors choose to house their fulfillment and/or tech development operations overseas. The firm is also licensed to originate in all 50 states and the District of Columbia, ensuring that credit unions nationwide are able to leverage PMP’s services compliantly. Furthermore, none of PMP’s competitors have the backing of a financial services luminary (not to mention a former regulator) like Eugene Ludwig. During his time as Comptroller of the Currency under the Clinton Administration, Ludwig was able to see first-hand the tremendous impact mortgage credit access has on the ability to build long-term wealth, and it was with these observations in mind that Ludwig founded PMP.

Watch the lending finalists for the 2021 Innovation Series talk about their solutions. Register today. Voting opens after the webinar.

REGISTER ToDAY

LENDING: SPLASH FINANCIAL

Steve Muszynski, Founder/CEO, SplashFinancial

Please describe your innovation.

Steven Muszynski: At Splash Financial, we help credit unions drive new high-quality loans, acquire new members, and compete against large financial institutions, online banks, and other lenders aggressively acquiring millennials and Generation Z consumers through digital channels.

Splash offers cutting-edge digital lending technology and a consumer acquisition engine to credit unions. Our innovation is not only our digital lending technology that provides approvals in minutes, but also our consumer marketplace for student loan refinance.

Splash spends tens of millions of dollars annually to drive consumers to our rate comparison platform, where we highlight and increase visibility of our credit union partners. As a result, our completely turnkey offering drives significant loan growth with strong returns and accelerates new member acquisition for our credit union partners all without a large upfront investment from them.

What opportunities or challenges does your innovation address?

SM: Between large financial incumbents who have significant technology budgets and digital disrupters across myriad financial product categories, such as mortgage, unsecured consumer lending, and savings/checking accounts, it’s hard for credit unions to acquire new members at a reasonable cost, put high quality loans on the books that drive a return, and diversify out of a high concentration in indirect auto loans.

Splash’s innovation addresses all of these items and helps credit unions compete with entities that might have larger technology or marketing budgets. Splash leverages economies of scale from our national marketing engine to cost effectively drive geographically concentrated new loans and members to credit unions.

How does your innovation increase member value for client credit unions?

SM: Splash increases values for client credit unions in three primary ways:

  • Helping credit unions reach and attract new millennial and Gen Z members.
  • Driving immediate loan growth with low default risk asset (replace auto loans).
  • Delivering high quality loan diversification.

What differentiates your innovation from competitors?

SM: Splash is changing the way consumers shop for and save money on their financial products. With our lending technology and student loan refinance marketplace, Splash democratizes access to amazing financial offers through the digitization of lending for credit unions. We differentiate from our competitors in three main areas:

  • Cutting-edge lending technology that provides a great experience for consumers and credit unions.
  • Digital marketplace to attract highly qualified millennial and Generation Z consumers.
  • Strategic digital partnership and a powerful member acquisition engine for credit unions.

Watch the lending finalists for the 2021 Innovation Series talk about their solutions. Register today. Voting opens after the webinar.

REGISTER ToDAY

All interviews have been edited and condensed.

Learn about other 2021 Innovation Series finalists:

  • 2021 Innovation Series: Mobile
February 16, 2021

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