Flagship Credit Acceptance is expanding into direct-to-consumer lending through an equity investment in automotive e-commerce technology provider Blinker, which offers loan origination technology powered by artificial intelligence (AI) and machine learning (ML).

WHY IT MATTERS: The partnership, announced earlier this month, allows consumers to apply for and complete financing online. Whereas Flagship previously purchased direct loans from its lending partners, Blinker’s technology allows the lender to enter the direct-to-consumer space, Flagship Chief Executive Officer Bob Hurzeler told Bank Automation News’ sister publication Auto Finance News. The direct-to-consumer program will roll out in the coming months.

WHO SAID WHAT: Blinker leverages AI, ML and vision technology to allow a consumer to upload photos of their vehicle and documentation, such as a copy of the title, verify their identity and upload necessary financing documentation online or via their smartphone, Blinker Chief Executive Rod Buscher told AFN.

“It’s truly an e-commerce transaction; [consumers] can do everything digitally,” he said, adding that the technology minimizes the risk of fraud by using ML to confirm identities and authenticate documents.

BY THE NUMBERS: Year to date, Flagship has secured about $1.5 billion in funding over three transactions in the ABS market, according to Finsight, which monitors securities.

Flagship, which has worked closely with Blinker for many years, is the sole investor in the tech provider’s Series C capital funding raise, according to a company release. Through the deal, Flagship will gain an unspecified stake in Blinker and proprietary ownership of the direct lending solution, Hurzeler said. Flagship did not divulge how much the company had invested in the deal.

Flagship has a managed portfolio of $3.8 billion, according to the release.

Editor’s Note: This is an edited version of an article first published on Bank Automation News’ sister site, Auto Finance News.

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