Consumer Portfolio Services (CPS) recently continued its robust roll out of artificial intelligence and machine learning solutions to provide greater payment flexibility and more efficient processing of retail installment contracts.
The company — which provides indirect auto financing to individuals with past credit problems, low incomes or limited credit histories — closed out the year with three major partnerships to improve efficiencies, dramatically reduce funding time and offer more payment options for customers.
The company chose Informed.IQ to automatically calculate income, collect and clear credit stipulations and dealer docs, creating a better dealer and consumer experience throughout the auto lending process.
CPS said through a news release that it expects Informed.IQ’s AI tools to significantly reduce the funding time.
For decades, CPS has focused on bringing improved intelligence to auto lending, becoming a leader in FinTech initiatives that enhance the front-end review and financial decision-making process.
CPS is also helping automate the backend servicing experiences and has partnered with Prodigal to better manage the collections and servicing workforce and process. Prodigal is a consumer finance intelligence solution that uses AI to analyze agent and borrower conversations and enhance profits, experience, and compliance.
For a customer standpoint, CPS named PayNearMe as its primary payments partner. This partnership will accelerate the finance company’s digital transformation and deliver a frictionless customer experience across all digital payment types.
CPS indicated PayNearMe will eliminate onsite cash payments, dramatically reduce the number of customers who pay by check and transition the majority of customers to electronic payments through greater pay options.
“Our whole business has become artificial intelligence and machine learning driven, from credit to servicing,” CPS chief operating officer Mike Lavin said. “Adding these three partners to our backend and front-end system at the start of the new year enables us to make the loan funding process easier, provide more accessible payment options for our customers, and use AI to effectively improve collections by reducing the workload.”
As of Sept 30, CPS has purchased more than $19.7 billion in contracts since the company began operations in 1991. The company currently services a total managed portfolio of approximately $2.7 billion with about 185,000 active customers.
In late first quarter, CPS said it will be introducing a new AI credit decision model that will improve fraud detection, lessen credit losses, and increase approval rates.
Then later in the year, CPS said it will be introducing an AI-focused scorecard for its recovery and repossession system that will combine delinquency data with machine learning allowing the company to better analyze when the right time is to recover a vehicle.
After Informed.IQ recently made inroads in subprime with Consumer Portfolio Services and DriveTime, this week the provider of artificial intelligence-based software for financial institutions finalized a partnership with F&I Sentinel, leading compliance and regulatory risk mitigation solutions provider.
According to a news release, Informed.IQ will combine efforts with F&I Sentinel’s CITADEL solution to provide a turnkey compliance solution with respect to the financing and resolution of F&I products.
The service providers are looking to address the rapidly changing regulatory environment triggered by the Consumer Financial Protection Bureau and state regulators, limit class action exposure and protect financial institutions and consumers.
As a result, Informed.IQ and F&I Sentinel see contracts being processed faster and more accurately with less fraud and audit risk, providing real-time verifications backed by compliance experts who possess more than 50 years of combined regulatory compliance experience specializing in the compliance of F&I products at both the state and federal levels
“We continue to see an increased need for lenders to implement an end-to-end compliance management system concerning the financing and resolution of F&I products F&I Sentinel CEO Stephen McDaniel said in the news release.
“Together, we will provide faster, more effective financing and continued investment in products and platforms within the vehicle financing ecosystem,” continued McDaniel, who is among the speakers at Used Car Week, which begins Nov. 14 in San Diego.
Informed’s AI and modeling can perform complex calculations, ensuring accuracy, identifying omissions, reducing bias and combating fraud. With a 99% accuracy rate and guaranteed service rates, the service provider said finance companies and dealers can focus less on legal and regulatory concerns and more on developing strong customer relationships.
“F&I Sentinel adds an additional mitigation layer against litigation and reputational risk, providing cutting-edge compliance solutions. We are excited to continue providing innovative technology and proprietary analytics to impact the future of consumer finance,” Informed.IQ CEO Justin Wickett said.
This week, Consumer Portfolio Services announced that it named PayNearMe as its primary payments partner, saying the service provider’s technology “is like gold.”
According to a news release, this partnership will accelerate the finance company’s digital transformation and deliver a “frictionless” customer experience across all digital payment types — cash, debit, ACH and mobile-first payment options including PayPal, Venmo and Apple Pay.
PayNearMe also will provide CPS the chance to digitize and simplify payments through every channel, including agent, web, mobile, IVR and digital wallet.
“PayNearMe has proven to be a key partner in our digital transformation,” CPS chief operating officer Mike Lavin said in the news release. “With its innovative technology solutions, we have eliminated onsite cash payments, dramatically reduced the number of customers who pay by check and transitioned the majority of our customers to electronic payments through greater pay options.”
Furthermore, CPS is using PayNearMe’s QR code payment technology to give its customers the ability to quickly and easily complete payments with many electronic payment options or with cash via PayNearMe’s retail network.
“Our goal is to make it as easy as possible for CPS customers to make their car loan payments on time,” PayNearMe vice president of customer success Dennis Esguerra said. “Consumers want the flexibility to use different payment types each billing cycle, such as paying by debit card one month, Venmo the next and cash another month.
“In fact, our research found that for 29% of consumers, having this flexibility would make it easier to pay bills on time. By adding PayPal and Venmo as payment types, CPS customers will have even more flexibility when they need to make a bill payment,” Esguerra continued.
Smart Link technology also is designed to makes it easier for CPS customers to make electronic payments from their smartphones via email, text or push notification.
“PayNearMe’s Smart Link technology is like gold,” Lavin said. “In as few as two taps on their smartphone, our customers can pay their bill using whatever payment type they prefer. That’s the type of innovation that makes it easier for our customers to pay their bills on time and sets PayNearMe apart as a great partner.
“We chose PayNearMe as our primary payments partner because their team understands our vision for the future, constantly presents us with new ways to create better digital experiences at scale, delivers incredible day-to-day support, and has the industry’s best bill payment technology platform,” he continued. “By expanding our relationship, we can further digitize customer payments, increase self-service transactions, and reduce payment-related call center interactions.”
Open Lending announced this week it is partnering with one of the nation’s largest credit unions, America First Credit Union (AFCU), which now will offer indirect auto financing services through Open Lending’s Lenders Protection program.
The companies said their alliance can allow dealers to give more opportunities for vehicle deliveries with credit union members who are near- and non-prime or emerging-prime.
“In an auto lending environment with climbing interest rates and persistent car inventory issues, Lenders Protection helps keep car ownership accessible,” said Tom Rice, senior vice president of national sales at Open Lending.
“Our partnership with AFCU will empower the credit union to offer auto loans with longer terms and better rates — and give more members access to financing that works for them in uncertain economic times,” Rice continued in a news release.
America First Credit Union will offer expanded services via Open Lending beginning in the fourth quarter.
“When it comes to first-time car buyers, the ability to offer auto loans with flexible terms helps us meet our members and buyers where they are financially,” AFCU chief lending officer Brett Christensen said in the news release. “As a credit union, we’re always looking for ways to better serve our current and future members’ needs.
“With Open Lending, we’re able to help more people achieve car ownership and build stronger relationships with our members, allowing us to better serve their future needs such as a mortgage, home equity or personal loan down the line,” Christensen went on to say.
To learn more about Open Lending or to schedule a demo, go to this website.
Informed.IQ, a provider of artificial intelligence-based software for financial institutions, has made notable inroads with providers in the subprime auto finance space.
First, continuing its focus on artificial intelligence and machine learning, Consumer Portfolio Services last month partnered with Informed.IQ to calculate income automatically, collect and clear credit stipulations and dealer docs, creating a better dealer and consumer experience throughout the auto financing process.
Then this week, DriveTime announced the next phase of its partnership with Informed.IQ to create a process for customers to digitally upload their documents to instantly verify income data.
Using Informed’s digital tools and machine learning solutions to collect and classify documents, extract data, compare information, calculate income and check for fraud, CPS said will reduce time, bias, costs, contracts in transit and fraud risk while being audit-ready.
“Our whole business is based on artificial intelligence and machine learning, from credit to servicing,” CPS chief operating officer Mike Lavin said in a news release. “Adding Informed.IQ to the equation enables us to handle larger origination volume, increase no-touch processing, more easily identify loan document defects and ultimately better support our customers to fund faster.”
Meanwhile, Informed and DriveTime collaborated to implement the software, allowing DriveTime customers to upload required documents for an auto finance application electronically, eliminating burdensome paperwork.
This next phase of the partnership enabled DriveTime to reach a new milestone of reducing the amount of time needed for the majority of customers to get their income stipulation approved from minutes to mere seconds.
“At DriveTime, we continuously seek to make the car buying and financing experience more enjoyable for our customers. DriveTime is excited to offer this digital capability allowing customers of all financial backgrounds to seamlessly get their application reviewed and approved in a fast, easy manner,” DriveTime vice president Brandon Kreitinger said in another news release.
Informed CEO Justin Wickett described working with both companies.
“At a time of heightened regulatory scrutiny and focus on underwriting and credit biases in lending, we are especially pleased to be working with CPS as they embrace AI and machine learning to continue their mission to serve the full spectrum market, enhancing their market competitiveness, while staying compliant and reducing fraud,” Wickett said.
“It’s been wonderful working with an innovative company like DriveTime,” Wickett added. “We are proud to support DriveTime as it continues to find new ways to support its diverse customers in the car buying process while providing access to credit for customers across the country.”
CreditMiner and TransUnion now are working together to stop auto finance fraud from happening, beginning with what can happen at dealerships.
Last week, the firms announced a new partnership to protect the automotive industry from high dollar losses from synthetic fraud via an application programming interface (API).
CreditMiner and TransUnion said through a news release that dealerships nationwide now can identify fraudsters, potentially eliminating losses by properly identifying high risk consumers.
“Incidence of synthetic fraud in auto lending has grown faster than any other financial sector as we emerge from the pandemic, nearly a 30% increase since Q1 2021.” said Satyan Merchant, senior vice president and automotive business leader at TransUnion. “The rapid growth of synthetic fraud — which is defined as building a fake identity over a period of a year or more — is becoming a complex issue.
“Synthetic fraudsters look like real people with great credit scores and well-established employment, which makes it very difficult for dealership personnel to identify,” Merchant continued.
CreditMiner chief operating officer explained Sam Vukas that the company’s tool, IDENTIFY, encompasses various driver’s license verification integrations as well as the use of mobile phone selfie biometrics.
“This solution utilizes the vast combination of technologies TransUnion brings to the table to protect dealerships from sophisticated thieves,” Vukas said in the news release.
Ken Luna is vice president of strategic partnerships for CreditMiner.
“We realized that the growth of synthetic fraud in the automotive industry was continuing to grow so we decided to focus our API efforts in the dealership arena and the vendors that serve them,” Luna said.
“What we like about TransUnion was they are ranked by Javelin, an independent agency, the top fraud prevention solution in the industry,” he continued. “These solutions are already being used in the lending industry but are not prevalent at the dealership level where most of the transactions occur, whether it be online or in person.”
For your contract holders who still want to make their monthly payment via cash, Payix and Nortridge Software are teaming up to provide a solution.
The REPAY company and provider borrower-facing collections and communications tools recently expanded its exclusive partnership with the software provider for finance companies and other loan servicing firms. The result is the opportunity to provide online cash payment acceptance, known as eCash, to Nortridge clients.
According to a news release, eCash can streamline payment acceptance by enabling contract holders to make payments using cash at thousands of participating retail locations, including major convenience stores, dollar stores and pharmacies. Cash payments are then settled electronically to the system of record to simplify reconciliation and end-to-end payment management all from one place.
Payix eCash technology will be embedded within the Nortridge Loan Management System (LMS), providing clients with enhanced payment acceptance capabilities, robust reporting, streamlined workflows and simpler reconciliation through the real-time integration.
“We are excited to add an online cash payment acceptance offering to our exclusive partnership with Nortridge Software,” Payix co-founder Preston Cecil said in the news release. “As a company focused on enhancing the borrower experience, we aim to improve the loan repayment process by offering convenient payment solutions for lenders and their borrowers.
“Our expanded partnership with Nortridge will continue to provide lenders with the ability to meet consumers’ payment preferences by equipping them with a cash payment option,” Cecil continued.
Nortridge Software president and chief executive officer Greg Hindson added, “Lenders are always striving for ways to improve collections.
“The integration between Nortridge and Payix makes it easy for borrowers to pay anywhere and anytime — benefiting both borrowers and lenders,” Hindson went on to say.
Protective Asset Protection announced just about a month ago that it was set to acquire AUL Corp. to create a conglomerate used by thousands of auto dealers.
On Monday, the provider of F&I programs and services signed a national agreement with RumbleOn, a technology-based omnichannel powersports platform.
As part of the deal, Protective Asset Protection will offer a full suite of F&I products to RumbleOn customers, along with expanded training and support to RumbleOn retailers.
According to a news release from Protective Asset Protection, the powersports market experienced record growth during 2021, with the industry expected to grow to nearly $50 billion by 2027.
“We are committed to offering unparalleled product offerings and services for the powersports industry and are excited about how the relationship with RumbleOn will benefit their dealers and customers across the country,” said Rick Kurtz, senior vice president and chief distribution officer at Protective Asset Protection.
“Our value proposition and overall product offering is robust and growing, and our suite of services will only help our dealer customers grow and thrive into the future,” Kurtz continued in the news release.
Protective Asset Protection vice president of specialty products and training Bill Koster added, “The powersports industry is at a very exciting time right now and many of our dealers continue to take advantage of consumer demand and a strong appetite for vehicles across many subsegments.
“We anticipate that extending our relationship with RumbleOn will further help our dealer partners ensure they protect their customers’ investment of their purchase,” Koster went on to say.
Marshall Chesrown is founder and chief executive officer of RumbleOn, which recently acquired the Freedom Powersports group and now has nearly 60 locations nationwide.
“We are very pleased to have the opportunity to expand our partnership with Protective, as we work to create a world class experience for all of our RumbleOn customers,” Chesrown said in the news release. “We appreciate the Protective commitment to the powersports industry and look forward to growing this critical area of our business.”
Alpha Warranty Services, a leading provider of vehicle service contract products to independent dealers, announced a strategic partnership on Thursday with Polly, which was previously known as DealerPolicy.
Through this partnership highlighted in a news release, Polly’s cost-saving personal insurance platform will help Alpha Warranty to provide a digital insurance shopping tool to its automotive dealers and their customers by integrating into Alpha Warranty Services proprietary Zoom F&I platform.
The Polly digital insurance shopping platform is the latest addition to Alpha Warranty’s suite of F&I products tailored to optimize the vehicle-buying journey through the sale of vehicle service contracts.
The companies said the partnership will be focused on driving greater revenue, per vehicle retail (PVR) and F&I product penetration for Alpha Warranty and its dealers.
“We’re thrilled to partner with Alpha Warranty to bring increased savings to their dealer network,” Polly co-founder and chief executive officer Travis Fitzgerald said in the news release.
Partnering with Alpha Warranty Services will allow Polly to further incorporate personal insurance into the car buying process at over 3,000 dealers nationwide.
“We couldn’t have found a better partner to join us in our mission to transform the car buying experience and set a new standard for consumers to purchase their automotive insurance,” Fitzgerald said.
Bryan Haakenson is vice president of business development at Alpha Warranty Services.
“Alpha Warranty has been a leader in providing technology solutions that enhance the dealer experience. In Polly, we’ve found a true partner that shares our vision,” Haakenson said.
“Polly is not only disrupting the automotive retail experience, but also laser-focused on enhancing the customer journey while still bringing immense value to our dealership partners,” he went on to say.
To learn more about Alpha Warranty during NADA Show 2022, book an appointment via this website. Polly is welcoming appointment for the event via this website.
Car Capital not only is building its team of executives as well as its financial resources, the auto-finance technology company that strives to get any deal bought no matter the consumer credit background is cultivating its portfolio of dealer clients, too.
This week, Car Capital announced the addition of strategic dealer partner, RightWay, which operates more than 40 independent dealerships in the Midwest.
Like Car Capital, a news release highlighted that RightWay looks to cater to underserved consumers who deserve quality vehicles regardless of credit or financial situation.
Car Capital’s solution is currently being implemented in nine of 43 RightWay stores and will expand to all locations by the end of the.
“We are privileged to welcome RightWay as a valuable Car Capital partner,” Car Capital co-founder and chief executive officer Justin Tisler said in the news release. “RightWay shares our values to make the car buying process easier for customers with challenging credit backgrounds.”
Through its proprietary, fully digital platform, Dealer Electronic Auto Loan System (DEALS), Car Capital can allow dealer partners such as RightWay to approve 100% of their customers instantly, regardless of credit history.
With DEALS, Car Capital explained dealers have the ability to make 24/7 approval decisions based on the economics of each unique vehicle and consumer. And dealer partners get back-end profit based on performance, not a minimum portfolio size.
Most of RightWay’s locations are in Michigan with other rooftops in Ohio, Indiana, Illinois and Missouri.
“Car Capital could not be happier for an amazing partner like RightWay to join our growing network of dealer partners,” Car Capital chief revenue officer Cory Cox said. “We appreciate RightWay for their dedication to getting underserved consumers into the best vehicles for them.”
Meanwhile, Cox is among the experts and executive set to appear during the Auto Intel Summit, which runs on April 12-14 in Raleigh, N.C.
The event is designed to answer the question of “what’s next” regarding technology impacting how vehicles are wholesaled, retailed and financed.
And you can save as much as $400 with early bird discounts available until March 14.
More details can be found at www.autointelsummit.com.
