Think of it as Shark Tank with a credit union spin, and it’s just been renewed for another season.
The 2024 Innovation Series from CreditUnions.com and Callahan & Associates is underway. Every year since 2018, this series has offered a select group of suppliers 10 minutes each to impress an audience of credit union decision-makers. It’s simple: Each vendor pitches its offerings and attendees vote on their favorites.
The Innovation Series was a hit from the get-go and continues to grow in popularity. This year’s focus areas include member analytics, fraud, lending, member experience, and payments.
Read on for more from this year’s Lending finalists: Alogent, Open Lending, Maxwell, and Velocity Solutions. Plus, make sure to join us for the Innovations In Lending webinar. Register Today!
Alogent
Describe Your Innovation.
AccuAccount streamlines loan management from application through servicing and is the only platform on the market to also offer integrated exception tracking. Empower lenders and other users with an automated loan review, approval processes, and transparent pipeline reporting.
Core-integrated, AccuAccount is proven to reduce paper and increase efficiencies across its more than 15,000 banking users. As the document management solution for the entire life of the loan, all documents, loan balances, contact information, exceptions, linked accounts, collateral, and related entities are just a click away.
Flexible imaging (barcodes, single scan, upload, ePrint, and drag and drop) is another reason why AccuAccount is the easiest way to collect and organize a credit union’s loan documents. Gain further automation by integrating exception tracking to clear exceptions faster and with less effort.
Streamlined reporting keeps lenders, senior management, and loan admins informed without manually pulling data files or merging outdated spreadsheets, elevating member services with fast access to data.
What opportunity or challenges does it address?
Building a commercial loan portfolio requires the right mix of expertise, time, effort, and technology. Unfortunately, not every credit union is adequately equipped, because:
Expertise: For years, credit unions have been primarily focused on serving the personal financial needs of their members. That’s led to a noticeable void in commercial lending expertise. And, there’s a lot to know. Compared to consumer loans, commercial loans can require far more paperwork, take longer to close, and involve more decision-makers. A real estate loan for a manufacturing company could be considerably different than an equipment loan for a trucking fleet, yet they’re both commercial loans.
Capacity: Hiring commercial lenders from community banks is one strategy for filling the expertise gap. However, each new commercial loan brings with it a considerable amount of administrative work. One commercial loan file could consist of hundreds of pages of documentation—from applications to promissory notes to credit presentations and tax returns. Some documents are only collected once, while customer financial statements and insurance documents are collected on an ongoing basis. Participated loans create even more downstream complexity. To keep pace, some financial institutions staff up with a team of loan admins and lending assistants, which represents a tangible opportunity cost.
Technology: Without the right tools, even the most efficient back-office team will struggle to handle the sheer volume of documents, exceptions, and tasks that are associated with a growing commercial loan portfolio. Commercial LOS, eSign, document management, and workflow systems are practically essential to compete in today’s commercial lending environment. But, having the right tools represents another investment decision for the credit union.
Implementing the right technology at the right time can soften the transition for credit unions looking to increase commercial lending. A system like AccuAccount offers features that can help establish a solid foundation for commercial lending.
Intuitive imaging: Instead of storing customer credit and loan documentation in paper folders, AccuAccount makes it easy to digitize and store everything in an intuitive environment. Better yet, credit unions can also use AccuAccount to organize existing documentation for members’ personal accounts and loans, providing a more comprehensive view of each relationship.
Built-in exception tracking and reporting: Tracking exceptions in a spreadsheet is tedious and inefficient. AccuAccount makes it easy to track document, policy, and other exceptions for members and their accounts. Automated reporting sends exception data to users’ inboxes on a regular basis. AccuAccount can also remind users of important tasks—such as taking action on expiring UCC financing statements—to prevent exceptions before they occur.
Automated workflows: Electronic routing of commercial loan files reduces the chance for misplaced and overlooked documents. It also creates a scalable workflow that can be repeated over and over again in accordance with your lending policy. Lenders, underwriters, and management will appreciate having immediate access to important information without waiting for interoffice mail to arrive. Integration capabilities: Imaging, tracking, and automated workflows are vital components of efficient commercial lending; however, core systems, LOS, eSign, and other tools play an equally important role, too. AccuAccount interfaces with 30+ systems to help your credit union build a highly integrated commercial lending ecosystem.
How does it increase member value?
Credit unions are increasingly interested in growing their commercial loan portfolios and ways to improve their loan quality, especially in light of recent and ongoing changes to business lending rules. Members are also poised to benefit from these changes, which open up new sources of funding for business owners and encourage increased competition in the market. Implementing a solution like AccuAccount can ease the transition for credit unions looking to increase commercial lending, speeding the time from application to approval and more efficient exception tracking, delivering better and faster member services.
- Intuitive imaging: Instead of storing member credit and loan documentation in paper folders, AccuAccount makes it easy to digitize and store everything in an intuitive environment. Credit unions can also use AccuAccount to organize existing documentation for members’ personal accounts and loans, providing a more comprehensive view of each relationship.
- Built-in exception tracking and reporting: Tracking exceptions in a spreadsheet is tedious and inefficient. AccuAccount makes it easy to track document, policy, and other exceptions for members and their accounts. With automated reporting, users receive exception data to their inboxes on a regular basis. AccuAccount can also remind employees of important tasks—such as taking action on expiring UCC financing statements—to prevent exceptions before they occur and delivering better member services.
- Automated workflows: Electronic routing of commercial loan files reduces the chance for misplaced and overlooked documents. It also creates a scalable workflow that can be repeated in accordance with a credit union’s lending policy. Lenders, underwriters, and management will benefit from immediate access to important data without waiting for inter-office mail to arrive.
- Integration capabilities: Imaging, tracking, and automated workflows are vital components of efficient commercial lending; however, core systems, LOS, eSign, and other tools play an equally important role, too. AccuAccount interfaces with 30+ systems to help a credit union build a highly integrated commercial lending ecosystem with the fastest access to business intelligence.
What differentiates it from competitors?
AccuAccount is the only loan imaging solution on the market that offers integrated exception tracking with automated exception reporting. With an integrated audit capability, AccuAccount can work with any core banking solution.
Open Lending
Describe Your Innovation
Lenders Protection™ is an AI-powered loan decisioning platform that analyzes 2 million risk profiles within five seconds and is fueled by over 20 years of proprietary Open Lending data supplemented with federated third-party data from TransUnion and LexisNexis. With Lenders Protection™, lenders get a score plus an approved or countered loan structure and risk-adjusted price backed by loan default protection. Because Lenders Protection™ looks at a broader range of rich data, credit unions can expand and diversify automotive lending by identifying reliable, often overlooked borrowers with lower credit scores or those just beginning to build their credit history.
As we have a long history of specializing in automotive lending, we are more accurately able to enable lenders in the auto lending space. Consumers who would otherwise be rejected or face unattainably high interest rates can now access the pervasive benefits of vehicle ownership and grow into healthy, prime borrowers.
What opportunity or challenges does it address?
With monthly payments and rates increasing and access to financing narrowing, vehicle affordability remains a critical issue among Americans, particularly near- and non-prime consumers. Credit unions that use Lending Enablement Solutions like Lenders Protection™ are uniquely positioned to offer competitive pricing to a more diverse pool of potential borrowers while managing risk and achieving yield targets. According to Open Lending’s Lending Enablement Benchmark Study, Lending Enablement Solution users are far less likely to report a rise in delinquency rates among those in near- and non-prime categories than non-users (12% vs. 57%) and are more likely to meet their ROA targets (95% vs. 73%). Lending Enablement Solutions ensures credit unions can serve the underserved while developing resilient, expanded portfolios.
Institutions that serve today’s near- and non-prime borrowers are also earning the loyalty of tomorrow’s prime borrowers. Analysis of credit migrations from before and during the COVID-19 pandemic found that near- and non-prime borrowers had the most upward credit mobility, with 43% moving to prime or super prime in 12 months, according to the Consumer Financial Protection Bureau. Because Lenders Protection™ delivers a more accurate view of risk, credit unions can expand automotive lending inclusivity to lower credit and new-to-credit consumers.
How does it increase member value?
Traditional measures of creditworthiness often mistakenly consider near- and non-prime consumers as too risky, excluding them from the benefits of automotive loans, which are key for building or improving credit. Lenders Protection™ generates a more accurate borrower risk profile to identify deserving consumers and extend them equitable automotive financing opportunities.
Open Lending’s 2023 Vehicle Accessibility Report shows that 55% of non-car owners have had to turn down a better job or promotion due to not owning a car, 62% stated that vehicle ownership would improve their ability to perform their current job, and according to the EPA, 88% of households rely on cars to shop for food.
Our data also revealed that near- and non-prime consumers are loyal, with 83% who don’t own a vehicle saying they’d be repeat customers with a lender they perceived as fair and straightforward and would even forego comparing options when it came to larger purchases, such as a house.
What differentiates it from competitors?
Lenders Protection™ differs from competitors because it uses extensive proprietary and third-party data generated from insuring over 900K loans and $21.1BN in cumulative insured loans to differentiate 2 million risk profiles of vehicle, loan, and borrower characteristics in under five seconds.
This Lending Enablement Solution predicts the probability of defaults with 99.1% accuracy in addition to predicting prepays and default severity and is the only solution on the market to offer high-quality loan default insurance from A-rated carriers that absorbs an average of 85% of expected deficiency balances and includes specific language to help achieve an embedded contract conclusion under CECL.
Lenders Protection’s cutting-edge automation also incorporates 21 additional alternative data attributes, including the number of payments made over the last year and the number of automotive and non-automotive inquiries over the last three years, to generate a more accurate risk profile beyond traditional credit scores.
This tool empowers credit unions to extend affordable automotive loans to their members during a time when car ownership has become increasingly out of reach for so many Americans. By using robust, reliable data, top-of-the-line risk analytics, and default protection, credit unions can help more deserving borrowers achieve financial freedom while managing risk and remaining profitable.
Maxwell
Describe Your Innovation.
Maxwell’s Point of Sale technology offers a modern experience designed to delight members and provide a powerful differentiator no matter the market cycle. Credit unions using Maxwell Point of Sale slash their time-to-close by 13+ days and save an average of 21 BPS in costs per loan. These concrete benefits result in a faster, more accessible lending process for the members credit unions serve.
The many features included in Maxwell Point of Sale work to streamline the mortgage experience, creating meaningful touchpoints with members that translate into long term business. These functionalities include robust integrations, streamlined preapprovals, and a modern application experience that allows members to easily complete the loan application on any device without a download. Credit unions who partner with Maxwell to serve their members, for instance, see mortgage application completion rates upwards of 90%.
By empowering credit unions to offer a top, modern lending experience, Maxwell Point of Sale helps strengthen the CU-member relationship while enabling these financial institutions facilitate more home loans, and thus more homeownership, in their communities.
What opportunity or challenges does it address?
In today’s competitive market, credit unions face the ongoing challenge of providing a seamless and efficient path to homeownership for their members while also differentiating themselves from other financial institutions. By partnering with Maxwell, credit unions can provide a top-tier mortgage lending experience backed by modern and intuitive technology members expect.
Maxwell Point of Sale also allows credit unions to enhance their mortgage lending process and overcome the challenge of lengthy time-to-close periods and high costs per loan. This helps improve the operational performance of the credit union, allowing them to give back to members.
Credit unions who partner with Maxwell address the challenge of outdated processes and high costs associated with traditional mortgage lending while increasing the overall value they provide to their members.
How does it increase member value?
Maxwell understands the credit union mission to better the financial lives of members. Maxwell helps deliver that promise with innovative technology built with members in mind. By enhancing the mortgage process with tailored digital solutions, Maxwell puts the member experience first, ensuring a smoother, easier journey to homeownership. Credit unions using Maxwell experience member application submission rates as high as 90%, proving the value of a modern and member-focused experience.
Today, we offer a comprehensive suite of features to support the member journey, including:
- Spanish translation: Members can complete the entire loan application in Spanish.
- Easy application: Members can pre-fill required fields by simply inputting their last name and social.
- Form brevity: Bite-sized sections do not overwhelm your members and ensure fewer mistakes and irrelevant fields.
- Instant verifications: Members can easily verify important loan application information (such as assets, income and employment) to streamline the experience.
Innovative benefits like these help credit unions better meet the unique needs of their members, meeting them where they are so they can achieve their homeownership dreams.
What differentiates it from competitors?
Maxwell is built to support credit union members and employees with a fast, easy borrower and loan officer experience. We understand that no two credit unions are the same. Unlike other mortgage software on the market, Maxwell provides a digital, member-focused experience tailored to fit the unique needs of the organization. Rather than a fixed, out-of-the-box solution, credit unions have the option to configure unique workflows and integrations.
These unique features provide credit unions with measurable results that improve team efficiency and member satisfaction. For instance, credit unions using Maxwell experience mortgage application completion rates upwards of 90%, and their LOs close 36% more loans per month compared to a top competitor.
Velocity Solutions
Describe Your Innovation
EVP, Product Management & Corporate Development,
Velocity Solutions
Akouba® is a digital lending platform that allows financial institutions of all sizes to offer business loans that are fast, efficient, and profitable. Akouba’s platform features a simple and secure borrower portal with a digital application to make applying a breeze, 24/7.
We provide the technology, training and compliance know-how, but our credit union partners control all the loan variables. The credit union sets the pricing, risk assessment and credit policies to ensure the best lending decision for them, and the best experience for their members.
Credit unions that were historically unable to enter the business lending market due to the cost, lack of resources and/or mediocre ROIs can now see profitability from even the smallest loans. We think that’s pretty innovative!
What opportunity or challenges does it address?
Many years ago, we identified a need in the small business space that was only exacerbated by the pandemic. Small businesses have historically struggled to obtain capital. The infrastructure just hasn’t been in place to help these struggling “Mom and Pop” businesses, as commercial lending was mostly set up for BIG businesses – those companies who had years and years of financial records, and a full team of accounting/finance professionals and a legal team. Smaller businesses were subject to the same sort of requirements, and historically weren’t able to produce the same types of reporting that the big corporations could. Financial institutions did not prioritize SMB lending because a $50,000 loan required the same resources as a $500,000 loan, and it simply wasn’t profitable.
Akouba’s platform is easy, efficient and includes comprehensive portals for both the lending and borrowing side. This makes it 1) easy to apply 2) easy to capture missing information 3) makes even the smallest loan profitable, without the need to add any additional employees.
How does it increase member value?
Our innovation provides an enormous added value to a credit union’s business members. Now, their small business members have the opportunity to obtain needed capital to keep their businesses going in Main Street America, USA. Many of the credit unions that Velocity Solutions/Akouba® works with are located in working class/rural communities, and those small businesses make up the backbone of those communities.
Akouba’s digital application and borrower portal make it incredibly easy for members to navigate the system. It helps to guide users through the steps, offering help, resources, reminders and even allows users to effortlessly upload their documentation – which is definitely one of the most time-consuming and painful parts of the process!
What differentiates it from competitors?
Too many differentiating features to mention, but here are the “Top 5.”
- Some of the larger lending platforms we’re competing with have “larger” price tags and implementation timelines. A recent Akouba implementation was completed two weeks before the deadline!
- Our system is easy and intuitive for the borrowers, guiding them through the process, mostly eliminating the need for human intervention. It even raises flags when there’s an omission or something that requires review.
- Automation of processes like KYC/KYB/fraud increases profitability and lowers risk. Akouba even offers automated spreading.
- Compliance. Akouba’s digital application was designed so that it already captured the data required for regulations such as Reg. B’s 30-day rule (the system has an automatic “remind” feature) and Rule 1071 requiring specific pieces of demographic data.
- Account acquisition and cross-sales: we provide marketing to help our credit union clients attract new borrowers to increase their loan portfolio. And some credit unions require their members to maintain an operating deposit account if they have a business operating line of credit, which also results in healthy boosts of deposits.
