VyStar Credit Union taps Zest AI for instantaneous loan decisions

byRick Morgan

November 4, 2019

in Banking, Strategy

Reading Time: 2 mins read

VyStar Credit Union is using Zest AI’s underwriting technology to speed up its loan assessment processes.

Through Zest’s tools, the Jacksonville, Fl.-based credit union can use both traditional and alternative data points to improve its underwriting capabilities, VyStar confirmed this week. Jenny Vipperman, chief lending officer at VyStar said the goal is to use automation to offer credit to as many customers as possible, while retaining humans to look at complex cases.

“We’ll still have underwriters, and over time we would like to [use automation] more and more, knowing there will always be something gray that we’ll need to look at,” Vipperman said. “Those underwriters will be valuable in other areas of our credit union, whether it’s analytics of the decisions or something else.”

Through Zest’s platform, the goal is to make the decisions instantaneous. Although VyStar is going beyond traditional credit bureau data, Vipperman said the credit union is not using social media data.

To start, VyStar will use Zest’s platform for consumer credit card underwriting, but the credit union eventually plans to use it for auto loans, business loans and personal loans. VyStar is still in the process of testing the underwriting model. VyStar’s goal is to have Zest’s underwriting model live for credit cards in the first quarter of 2020. The credit union will continue to test the model, and over time, it will examine delinquencies and losses.

According to Mike de Vere, chief operating officer at Zest, through alternative data points garnered through its platform, financial institutions like VyStar can offer better terms to customers it otherwise won’t be able to reach. De Vere said its clients on average see a 30% decrease in charge-offs and a 15% increase in approvals.

Bob Meara, a senior analyst at Celent, said VyStar is setting itself apart because smaller financial institutions often lack digital onboarding tools. Of those that do, most don’t hire an AI company for credit underwriting. Instead, they typically rely on the capabilities of their core technology systems, he explained.

VyStar Credit Union has more than $9 billion in assets.

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