Jason talks to Jeff Keltner, Senior VP of Business Development at Upstart. It is an online lender that utilizes artificial intelligence throughout various parts of the underwriting life cycle in order to issue policies as quickly and effectively and with a better risk profile than conventional.
Episode Highlights
- 0.32: Upstart is an AI lending marketplace where we power bank and credit union lending programs across a variety of products including unsecured consumer loans, auto refinance and purchase loans, says Jeff.
- 1.03: The other key thing we work with our partners on is helping them acquire new customers. We not only serving their current customer base but being able to find new customers effectively and efficiently for their institution, says Jeff.
- 3.16: We run a marketplace for consumers at upstart.com where they could come and we will pair them with one of our bank or credit union partners depending on the risk profile, the geographic footprint, and things like that, says Jeff.
- 4.02: The credit file has hundreds if not over 1000 pieces of information about a consumer and most lenders reduce that credit file down to four or five things.
- 8.02: Jeff says that they have got banks that are regulated by every major regulator and credit union. They have been through exams with these loans on the portfolio and most of them are driven by the desire to serve customers better.
- 10.11: Every consumer-oriented bank Jeff has talked to is mainly focused on "how I better serve the consumers that I am working with and that drives more than expected what they want and their willingness to take a little bit of risk."
- 13.18: In the era of online lending, sometimes people are applying for loans at multiple places at once, and you may not have the information about the latest loan taken out on the Bureau you got because they took it out the day after they applied for you.
- 16.01: At the end of the day, it always comes down to cost distribution in almost any business, and that determines your potential market size for any product, says Jason.
- 19.49: We find that the model that public sector workers often are more creditworthy of their credit score, says Jeff.
3 Key Points
- Jeff talks about the entire consumer lifecycle compared to vendor life cycle and how they go about getting approved and how does it work differently with you than at elsewhere.
- When someone submits the online form, and we are going to assess the risk and we are going to assume at this point that everything they told us is true. That may not be a good assumption, but for the risk model, we kind of says given these inputs, what's the risk, says Jeff.
- Jeff explains the difference between getting digital and really optimizing these processes in the productivity enhancements.
Tweetable Quotes
- "The most online lending was kind of the digitization of the process, but not fundamentally changing how we thought about risk." - Jeff
- "Avoiding the downside at all costs is hugely a concern for most people because this is an industry that almost rewards people for saying no." – Jason
- "We also use connectivity to the bank account to look at transaction history and that actually helps you identify three things at least." – Jeff
Resources Mentioned
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