CUSO Develops New Lending Decision Model
The new model takes a look at a member’s status and relationship with the credit union to help determine a loan approval decision.
Grand Rapids, Mich.-based CU*Answers, a 100% credit union-owned core data processor began 2020 with a couple of tech announcements involving a new reputation-based consumer lending decision model and a core conversion.
CU*Answers has begun development of a new reputation-based decision model. CLR Path – an acronym for “Consumer Lending on Reputation” pronounced “clear” – is a new in-house decision model that takes a look at a member’s status and relationship with the credit union to help determine a loan approval decision. With CLR Path, credit unions can create and customize their own decision model programs for any of their loan products using new tools in CU*BASE®, the CUSO’s core data processing platform.
In addition to credit score, the configuration includes dozens of data points pulled directly from CU*BASE membership data, including member age and membership tenure, history of prior loan performance, current account balances and direct deposits. CLR Path can even look at a member’s overall relationship status using the CU*BASE Tiered Services CRM tools.
Pete Winninger, vice president of professional services, noted, “the service will be 100% free to use, so the model will be run automatically on every loan application for a member in the CU*BASE LOS.” Introducing the project to credit union CEOs at the November CEO Strategies conference, Randy Karnes, CU*Answers CEO, called CLR Path “a non-FICO decision model for the gray areas.” Said Karnes, “When you approve a loan because you know the person and trust the experience you already had with them, CLR Path will help you validate what you claim to know, and confirm that you checked.”
CU*Answers also announced the $20 million Hamilton, Ohio-based AllWealth Federal Credit Union recently executed a contract to change its existing core data processing platform to the CU*Answers CU*BASE® system, the CUSO’s flagship solution.
AllWealth Federal Credit Union CEO Kim Eads said: “AllWealth Federal Credit Union is delighted to be working with CU*Answers for our core banking software. Our current system was becoming cost prohibitive. We needed increased efficiencies along with better integration to produce a better experience for our member. So, after extensive research of multiple vendors and contacts with credit unions who use the systems under consideration, the members of our search team selected CU*Answers and their CU*BASE product.”
“CU*Answers will allow us to have single sign-on with all our partners,” Eads added. “We will be able to target our members for specific promotions by using the system provided without incurring additional costs. We will have a mobile app that will allow our members 24/7 access to their accounts no matter where they are. This system also allows us flexibility in-case of a disaster and we lose our brick and mortar. This core data platform will allow us to compete with the bigger credit unions around us.”
AllWealth Federal Credit Union is slated for a June 1, 2020 conversion, and will bring approximately 3,200 members into the CU*Answers family.