Chad Otar, the founder and CEO of the Lending Valley start up says the firm is testing proprietary AI algorithms to evaluate files in seconds. Fitting into a few seconds something that would usually take days to accomplish? Apparently so.
With shortening of the underwriting time that is involved, his advisors can proceed to give a recommendation on a given loan with a slim wait time. Whenever Lending Valley’s clients want fast funding, changing a rather ‘pretty fast’ application process into ‘record speed’ can be the decisive stroke that makes the front-runner until the competitors and there are many. Not by chance, the funding powerhouse is chock full of enthusiasm to perform on the continually escalating expectation of online consumers.
AI may be the trending topic of 2020, yet Chad Otar urging a word of caution on the right applications. In the words of the CEO and the thought leader it’s not about using all—It is about using the right ones in your industry. Specific examples include that in the Finance industry, he doesn’t like that AI is involved in decisions on which loan to recommend, and notes that we’ll need to proceed cautiously with the self-service lending craze.
The experts say that funding recommendations has to do with what the client needs, what he can pay and what he or she needs for different stages in the life cycle of his business. But that’s only the start. There’s a lot to factor in. At the moment, it is cannot do that as well as a lending expert can. Otar adds: “What AI can do—it by definition or in our industry— is optimize the processes prior to the system. What we are currently implementing is a very complicated algorithm supported by years of data to extract all the necessary information and connect each client with the most optimal approval of the loan in several seconds. It’s going to start that drive, and that’s what’s going to drive us forward.”
Well if AI is not yet prepared to take over their communication with their clients now then what is the FinTech sector employing it for?
3 FinTech areas in which AI is most active
Establishing Creditworthiness
Lending 101: how much of a loan is worth depends on estimating the probability of the borrower or business failing on the said loan. In fact, it is a gargantuan task to arrive at this formula, even if all information is available at your fingertip. Remember that more often than not, the information in the application is either inadequate, misleading or – as with 15 to 25 percent of millennials applying for credit – completely fabricated. Even now we find ourselves putting in major hours into a portion of the loan process and there is small yield.
AI can look at virtually any list of factors that are far beyond FICO score, income, and expenses and determine creditworthiness in just a few seconds. In fact, even those who do not have credit history could be evaluated most often with a quite high accuracy using the data AI can consider.
Streamlining processes
As Otar points out one can easily agree with him that it is in those areas that the processes involved in lending application that AI can actually pay for itself. Businesses across the country are increasing their profits and also decreasing wages based on the decisions to rid themselves of cumbersome bureaucratic systems and avoid the eventualities of a paper pile-up. More inspiringly, by radical AI simplification of your functional tasks, this frees up your people to do what you hired them for, to do for your business; to create great client relationships, and strong loan recommendations.
Improving customer experience
Traditional lenders in the field of loan-specific AI range are employing artificial intelligence tools in an effort to increase the rates of performance on loans as well as managing them. Chatbots, prompts, analytics, and CRM—Customer Relationship Management—management solutions assist with customers kept out of the danger zone towards loan defaults. The next evolution of the startup is their entry into the lending space with the use of artificial intelligence. Today, one of the priorities for its leader is managing growth.
The company has become notably large in the 11 months since it was created, and has worked to leave behind other competitors on the micro funding circuit. This first year alone has seen Lending Valley mobilize more than 2 billion dollar for her clients, and assisted over a thousand micro, small and medium enterprises in meeting their working capital needs. Proud of their partnership with NYC’s Broker Fair 2020, the Lending Valley team aims their name right at the country’s best commercial finance brokers and lenders.
