Latest / Leaders in Lending / Small Steps, Big Gains: Scaling Success with AI in Credit Unions in 2024

Transcript

Small Steps, Big Gains: Scaling Success with AI in Credit Unions in 2024 · Leaders in Lending

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  Speaker 1: You're listening to Leaders in Lending from Upstart, a podcast
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  Speaker 1: dedicated to helping consumer lenders grow their programs and improve
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  Speaker 1: their product offerings. Each week, here, decision makers in the
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  Speaker 1: finance industry offer insights into the future of the lending industry,
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  Speaker 1: best practices around digital transformation, and more. Let's get into
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  Speaker 1: the show.
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  Speaker 2: Hello and welcome to Leaders in Lending. I'm your host,
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  Speaker 2: Drew Megory, and this week's episode is a special reairing
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  Speaker 2: of a conversation originally featured on America's Credit Unions podcast,
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  Speaker 2: The SeeU Lab, where Barry Roach and I dive into
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  Speaker 2: how credit unions can win. In twenty twenty four, we
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  Speaker 2: talk about how AI and fintech partnerships can help institutions
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  Speaker 2: tackle challenges such as liquidity constraints and keeping up with
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  Speaker 2: ongoing regulatory hurdles, to name a few. With that said,
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  Speaker 2: I hope you enjoy this week's show.
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  Speaker 3: Hello, and thank you for joining us for another episode
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  Speaker 3: of the CEU Lab. I'm modeling Crownfeld with America's Credit
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  Speaker 3: Union and I'll be your moderator.
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  Speaker 4: Today.
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  Speaker 3: I'm sitting down with Barry Roach and Drew Magrie, senior
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  Speaker 3: account managers at Upstart, and we're going to discuss how
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  Speaker 3: credit unions can win in twenty twenty four. Barry Drew,
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  Speaker 3: it's great speaking with you, and thank you so much
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  Speaker 3: for joining us today.
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  Speaker 4: Thanks having to me, great to be here. Great.
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  Speaker 3: Well, let's start with just a little more information about
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  Speaker 3: your roles at Upstart.
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  Speaker 4: Thanks Malan. I'm Barry Roach. I'm a senior account manager
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  Speaker 4: here at Upstart. I've been with uptur for about eighteen months,
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  Speaker 4: but prior to my time with Upstart, I was CEO
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  Speaker 4: of two different credit unis in California for about ten
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  Speaker 4: years and have about twenty years total in the credit
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  Speaker 4: union industry. So very familiar with the challenges that we
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  Speaker 4: have in credit unis and happy to be here to
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  Speaker 4: talk about that a little bit today. True.
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  Speaker 2: Yeah, thanks Barry. So I've been with Upstart, coming up
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  Speaker 2: on almost three years now, but prior to Upstart, I
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  Speaker 2: started my career in the financial service industry about fifteen
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  Speaker 2: sixteen years or so, where I actually started in the
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  Speaker 2: insurance business and then quickly transitioned into the regional banks
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  Speaker 2: where I worked in multiple areas that pertain to consumer
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  Speaker 2: lending in some form of a capacity. After about five
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  Speaker 2: or six years of doing that regional bank space thing,
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  Speaker 2: I wanted to get out and about and check out
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  Speaker 2: this credit union space that I heard so much about.
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  Speaker 2: And I was fortunate enough to lead the Ohio Teamsters
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  Speaker 2: credit Union for just shy of nine years as president
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  Speaker 2: and CEO before coming to Upstart to help build up
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  Speaker 2: the account management team's focus in partnering with credit unions.
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  Speaker 2: Going back to your initial ask of what does the
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  Speaker 2: account management function entail here at Upstart is we do
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  Speaker 2: have a dedicated team made up of prior executives both
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  Speaker 2: in credit unions and in banks, and you can kind
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  Speaker 2: of think of as our function as like an ongoing
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  Speaker 2: post sales support as this is not, of course the
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  Speaker 2: setate and forget a business. And what we really strive
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  Speaker 2: to do is own the executive relationship with our partners
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  Speaker 2: and almost act as if we're an extension of their
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  Speaker 2: organization to give this more of a partnership feel rather
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  Speaker 2: than just another vendor type of feel. And where this
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  Speaker 2: helps is because of course, to what Barry and I
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  Speaker 2: have already talked about as we've sat in those chairs
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  Speaker 2: and we have done the work of the people that
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  Speaker 2: we work with on a day over day basis, and
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  Speaker 2: this helps because our team is able to provide positive
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  Speaker 2: insights to their programs to assist in meeting strategic goals
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  Speaker 2: and objectives as part of our partnership. But they can
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  Speaker 2: also leverage our partnership to augment other key initiatives within
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  Speaker 2: their organization that they may be trying to fulfill as
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  Speaker 2: part of their business plans throughout the current state and
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  Speaker 2: in future years ahead.
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  Speaker 3: Great well as past credit union CEOs, you both have
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  Speaker 3: a very unique perspective on this, So could you speak
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  Speaker 3: about some of the challenges that credit unions are facing
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  Speaker 3: in today's environment?
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  Speaker 4: Sure, thank you, Madlin, So Drew and I speak to
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  Speaker 4: executives from across the country on a daily basis, and
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  Speaker 4: for the most part, there are less regional differences in
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  Speaker 4: terms of the challenges than there are sort of right
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  Speaker 4: across the country. Everyone has liquidity concerns, certainly maybe not
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  Speaker 4: as bad today as it was in early twenty twenty three.
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  Speaker 4: We're hearing less and less about concerns about liquidity and
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  Speaker 4: more about as the positive come back, as investments have
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  Speaker 4: run off and now looking for reinvestment opportunities, where's a
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  Speaker 4: good place to put that money you hold it or
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  Speaker 4: do you invest it in sort of higher yielding assets
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  Speaker 4: right now? And I mean we've seen in the learning
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  Speaker 4: space now yields as high as they've been in since
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  Speaker 4: before the Great Financial Crisis. So with that, that's great
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  Speaker 4: learn income coming in. Well, what about credit quality, because
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  Speaker 4: we have seen sort across the country certain degradation in
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  Speaker 4: credit really in all astic life and across the spectrum
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  Speaker 4: of risk, though not just subprime performing or underperforming as
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  Speaker 4: big maybe, but also for the prime space. We've seen
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  Speaker 4: through data from our partnership trained being, for example, a
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  Speaker 4: little bit of stress for all borrowards out there right
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  Speaker 4: now through anything you could add from what I've heard
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  Speaker 4: from some of my lending departments.
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  Speaker 2: Yeah, one thing to kind of touch off that whole
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  Speaker 2: credit risk and defaults rising, right, everybody knows that the
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  Speaker 2: personal savings rate continues to drop, defaults trying to rise
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  Speaker 2: across all asset classes. And we have this new thing
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  Speaker 2: as of December called CECIL and how to manage those
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  Speaker 2: methodologies at a really odd time, right, so being able
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  Speaker 2: to predict risk and look at what those ongoing trends
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  Speaker 2: are across all assets in comparison to what the defaults
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  Speaker 2: are doing I've heard a lot of chatter around the
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  Speaker 2: challenge of how to formulate an accurate cecil methodology, and
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  Speaker 2: as a result, informing those methodologies, it's taken a hit
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  Speaker 2: to some credit unions across the country from a net
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  Speaker 2: income perspective. So that's another one that I'll add around
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  Speaker 2: around credit risk for sure.
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  Speaker 4: And of course there's always the competitive risk, right, so
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  Speaker 4: all credit nis are trying to remain viable for their
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  Speaker 4: membership and to attract new members as well, and so
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  Speaker 4: you have to have nowadays not just a great brand
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  Speaker 4: footprint and a great experience when members are walking into branches,
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  Speaker 4: but digital footprint is very important as well in that
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  Speaker 4: digital experience. So, especially through Upstart, a lot of what
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  Speaker 4: we do is to help introduce those brand new borders
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  Speaker 4: who are now becoming members of credit unis with a nice,
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  Speaker 4: elegant digital experience when it first applied for loans through
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  Speaker 4: the Upstart platform. So that's just one example of those
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  Speaker 4: competitive stresses. But also now AI AI has become this
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  Speaker 4: new buzzword and now you know, boards are saying, well,
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  Speaker 4: tell me about your AI strategy. It's like, well, what
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  Speaker 4: is AI? You know, we have a lot of crediting
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  Speaker 4: executives are struggling with perhaps understanding not only what AI is,
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  Speaker 4: but not necessarily understanding how AI can help their business
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  Speaker 4: and help move their crediting forward in terms of a
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  Speaker 4: much better value proposition for their membership. One thing up
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  Speaker 4: there does do around AI is that is key in
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  Speaker 4: how we perform our underwritings. So we've been using our
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  Speaker 4: digital intelligence machine learning for years now and with AI
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  Speaker 4: and with training data, the more data and the more
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  Speaker 4: time you have, the more accurate both predictions can be.
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  Speaker 4: So both Drew and I have found I think that
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  Speaker 4: just providing that for our blending partners has been a
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  Speaker 4: great help for them in not just sort of knowing
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  Speaker 4: how ay I can help the business, but actually leveraging
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  Speaker 4: it and having a fancible impact on their business.
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  Speaker 2: Another thing I'll add to on a side of just
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  Speaker 2: AI and of course cost of funds and liquidity and
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  Speaker 2: all this fun stuff is the increasing regulatory environment is
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  Speaker 2: another challenge that I've heard too, and the cost associated
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  Speaker 2: with it too. Like you go through an NSU exam,
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  Speaker 2: seet PB exam, I don't know what the asset size
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  Speaker 2: of the listeners are. The multitude of different things that
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  Speaker 2: are needed to be done from a regulatory and compliance
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  Speaker 2: perspective have elevated in the past two three years to
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  Speaker 2: the point where you're having to add additional fte within
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  Speaker 2: your organization to adhere to those regulatory requirements. And that's
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  Speaker 2: been another real key challenge in the credit union space
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  Speaker 2: in the past few years.
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  Speaker 3: Yeah, I think those are some challenges that we've been
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  Speaker 3: hearing kind of across the board. But let's take in
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  Speaker 3: a little bit more and address AI and how that
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  Speaker 3: can really help in the face of some of these challenges.
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  Speaker 2: Yeah, I'll start here, and I'll preface that the Upstart
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  Speaker 2: crew did have some boots on the ground last week
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  Speaker 2: at acus CEO's conference in Key West, and the general consensus,
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  Speaker 2: outside of some of the stuff that we've already outlined,
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  Speaker 2: is really two things. Is credit unions, even though they're
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  Speaker 2: very widely known across the country, they continue to struggle
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  Speaker 2: with providing what their identity is and getting the word
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  Speaker 2: out within their communities of what is the value that
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  Speaker 2: credit unions possess. And then the second, as a result
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  Speaker 2: of that conversation, the credit union consolidation could be coming.
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  Speaker 2: We once had ten thousand credit unions in the country.
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  Speaker 2: Now down to five thousand. Don't quote me ONCT the
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  Speaker 2: exact number, but somewhere in that realm. And this is
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  Speaker 2: in large part due to the struggles to manage again
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  Speaker 2: those inatory requirements, the cost associated with that. You're competing
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  Speaker 2: with the Chase, the Wells, Spargos, the Bank of Americas,
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  Speaker 2: and as a result, some of that profitability is going away.
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  Speaker 2: So to your point about how AI can address some
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  Speaker 2: of these challenges already outlined, is I'm going to go
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  Speaker 2: through kind of like three key themes of things that
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  Speaker 2: we hear and things that we talk about here at Upstart,
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  Speaker 2: and one of those themes is going to be innovation innovation,
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  Speaker 2: and I'm going to start it around the thought of
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  Speaker 2: automation less human interaction. Consumers today do not want to
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  Speaker 2: talk to an individual and a branch as much as
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  Speaker 2: they would like to click some buttons on their phone,
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  Speaker 2: their tablet, their computer, what have you, and not have
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  Speaker 2: that human interaction and have that fully automated experience. To
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  Speaker 2: give you some numbers, for instance, just on the Upstart platform,
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  Speaker 2: of the borrowers that come through the top of our
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  Speaker 2: funnel and apply for a loan and get funded, ninety
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  Speaker 2: percent of those individuals are going through a fully automated
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  Speaker 2: experience and then fast forward from another thought process of innovation,
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  Speaker 2: it creates an elevated member experience. You want to serve
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  Speaker 2: your member base, you want to serve your net new
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  Speaker 2: members that you could be obtaining through partner channels or
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  Speaker 2: even within your own internal type of rails, of ways
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  Speaker 2: to promote products to your membership, and that elevated member
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  Speaker 2: experience giving them real time decisions whether they're good bad
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  Speaker 2: from the comfort of their own home. It allows that
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  Speaker 2: member experience to be elevated for them to come back
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  Speaker 2: to you for additional needs that they may have. Going
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  Speaker 2: back to the theme of credit risk or economic uncertainty, things
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  Speaker 2: could of course change month over month based on what
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  Speaker 2: we're seeing in some of the data, but it's been
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  Speaker 2: proven that the use of AI for decisioning loans particularly
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  Speaker 2: that's our general scope of what we do here at upstart,
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  Speaker 2: is it is a better predictor of default. It's a
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  Speaker 2: better predictor of risk in comparison to using traditional underwriting
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  Speaker 2: methods that maybe wouldn't allow for an approval of a
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  Speaker 2: member on your internal policy and procedure. I'll give some
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  Speaker 2: some statistics here too is for Upstart particularly, our model
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  Speaker 2: is about three times better at separating risk between the
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  Speaker 2: highest and lowest Fyco bands, which again goes back to
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  Speaker 2: being able to say yes to more borrowers. And an
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  Speaker 2: example of that is someone that has a six forty
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  Speaker 2: FICO grade may qualify for some form of loan within
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  Speaker 2: your institution, but the actual probability of that individual of
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  Speaker 2: defaulting may only be let's say fifty basis points. So
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  Speaker 2: being able to price that accurately and predict that risk
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  Speaker 2: accurately allows you to play in that lower tier of
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  Speaker 2: Fyco borrowers within your organization. And then the last kind
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  Speaker 2: of key theme that I'll address is is competition and cost.
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  Speaker 2: I talked a little bit already about the competition in
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  Speaker 2: comparison to the larger banks, but you're also competing with
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  Speaker 2: that potential credit union consolidation revolution. You're competing with the
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  Speaker 2: ten billion plus credit unions or the top twenty five
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  Speaker 2: that are able to reach a broader range of members
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  Speaker 2: and build their businesses, and you're only able to adhere
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  Speaker 2: to your existing field of membership, which might be smaller
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  Speaker 2: in nature. So using AI under multiple platforms, not just
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  Speaker 2: in lending, can allow your organization to really be one
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  Speaker 2: with the times and better compete across the financial service ecosystem.
• 12:14
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• 12:16
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  Speaker 5: slash AI Certification. Thanks, and now back to the show.
• 12:57
  Speaker 4: To add to what through was saying, we just entered
• 13:00
  Speaker 4: a new feed thure within ubserve. We call it recognized
• 13:02
  Speaker 4: Customer Personalization the fancy long term. Basically, all it means
• 13:06
  Speaker 4: is it's a method for upsearch to identify borrowers on
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  Speaker 4: our platform who belong to our partner credit unions right
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  Speaker 4: at the beginning of the application, so we can drive
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  Speaker 4: those applications to our lending partners in a much more
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  Speaker 4: efficient and faster way. And it's increasing the cross sell
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  Speaker 4: now for those members and bring a better relationship for
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  Speaker 4: that crediting member. So that's a new feature that's coming
• 13:32
  Speaker 4: in and this kind of illustrates a lot of the
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  Speaker 4: innovation that Upstart is doing. We're not just an AI
• 13:39
  Speaker 4: lending company. We're constantly trying to find ways so we
• 13:43
  Speaker 4: can better support our lending partners and new lending partners
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  Speaker 4: coming on board all the time.
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  Speaker 3: Yeah, I mean, just that line about being able to
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  Speaker 3: say yes to more borrowers, I think that's crucial to
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  Speaker 3: the credit unions that you're working with. Being able to
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  Speaker 3: better serve their members is really critical. So well as
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  Speaker 3: you know the credit union space, it's really collaborative. Peers
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  Speaker 3: are learning directly from one another. Do you have some
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  Speaker 3: examples of partners that you're working with who are really
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  Speaker 3: successfully addressing these challenges.
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  Speaker 4: I can say that I've got a couple of newer
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  Speaker 4: lending partners who came to ups are not just looking
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  Speaker 4: for ways that they can improve their lending capability and
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  Speaker 4: certainly add some good quality high yielding loans in their books,
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  Speaker 4: but they're also looking for how can I expand my membership?
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  Speaker 4: So field and membership is different amongst all credit ings,
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  Speaker 4: and some are more successful at leveraging. They're larger charters,
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  Speaker 4: they're larger field of membership than others. What ups are
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  Speaker 4: can do is actually almost on a turn can debate
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  Speaker 4: to provide new members for those creditings that are coming
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  Speaker 4: in markets that maybe they're not they're not a lot
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  Speaker 4: of active in so my old crediting and others I've
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  Speaker 4: spoken to, for the most part, those marketing activities are
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  Speaker 4: centered around their market where there's a brand footprint. However,
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  Speaker 4: they may have other need the other states of other
• 15:01
  Speaker 4: areas of the country where they have the ability to
• 15:04
  Speaker 4: onboard new members but just haven't really realized an effective
• 15:08
  Speaker 4: marketing spend in those markets. And I'll start confind borrowers
• 15:12
  Speaker 4: in those markets, deliver them to these creditings as new members,
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  Speaker 4: and now it gives you an app back to be
• 15:18
  Speaker 4: able to get that second and third product service from
• 15:21
  Speaker 4: that brand new member and really establishing strength in that
• 15:24
  Speaker 4: relationship from there.
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  Speaker 2: Yeah, I'll give a more seasoned example without naming names,
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  Speaker 2: but we have a partner about two and a half
• 15:34
  Speaker 2: billion or so in assets that's been leveraging our platform
• 15:38
  Speaker 2: for about two years now. Of course, their CFO has
• 15:41
  Speaker 2: that l word of liquidity being top of mind and
• 15:44
  Speaker 2: almost all of twenty twenty three, but coming into twenty
• 15:47
  Speaker 2: twenty four, without giving exact dollar amounts, they increased their
• 15:50
  Speaker 2: monthly capital with us to of course drive the higher
• 15:53
  Speaker 2: yields right with it being a performing asset within expectations,
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  Speaker 2: they were able to utilize the higher yielding asset to
• 16:00
  Speaker 2: augment their high cost of funds to retain their share
• 16:03
  Speaker 2: accounts and their certificates, a deposit that we're starting to
• 16:06
  Speaker 2: run off in the first quarter of this year. So
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  Speaker 2: they're with leveraging our program with increased capital in the
• 16:12
  Speaker 2: twenty twenty four This also allows to Bury's point of
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  Speaker 2: how our program works, allows them to originate more net
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  Speaker 2: new members in growing their member base, and then they're
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  Speaker 2: doing a very very good job on the back end
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  Speaker 2: of providing cross sell opportunities. And some metrics here again
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  Speaker 2: is they're seeing roughly a twelve to fifteen orsh or
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  Speaker 2: so percent conversion rate on secondary products outside of just
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  Speaker 2: the unsecured personnel that they're obtaining from upstart and of
• 16:37
  Speaker 2: course the opening of the share account, and they've been
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  Speaker 2: seeing success on that across multiple different assets, not just
• 16:43
  Speaker 2: credit cards and autos, but they've seen some helock, they've
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  Speaker 2: seen some deposit growth in cross sell too, So they're
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  Speaker 2: doing very successful and of course increased capital, using that
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  Speaker 2: yield to offset their cost of funds and then getting
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  Speaker 2: that net new member and expanding that net new member
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  Speaker 2: experience and being able to deliver multiple product across the
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  Speaker 2: product offerings. Right.
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  Speaker 4: So, you know, as Drew says, we are an extension
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  Speaker 4: of the leadership team. We're not just dealing with the
• 17:06
  Speaker 4: lending folks in credit unions or finance folks. We're also
• 17:10
  Speaker 4: dealing with the marketing people and think about the opportunities
• 17:13
  Speaker 4: to provide for marketing. You can ab test all kinds
• 17:16
  Speaker 4: of different ways while onboarding these new members. You can
• 17:19
  Speaker 4: see what works and what doesn't. You can throw out
• 17:21
  Speaker 4: what doesn't even try and do more of what is
• 17:24
  Speaker 4: working and sort of layer on other marketing treatments and
• 17:28
  Speaker 4: elements from there. There's lots of different ways of measuring this.
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  Speaker 4: We sit with marketing people all the time and sort
• 17:34
  Speaker 4: of brainstorm ways that they can improve cross sell or
• 17:37
  Speaker 4: reach out to these brand new members that they're that
• 17:40
  Speaker 4: they're getting from Upstart.
• 17:42
  Speaker 2: Yeah, and on that, like I would I would even
• 17:44
  Speaker 2: add outside of just Upstart or lending in general, is
• 17:49
  Speaker 2: if you're looking to utilize AI in any realm of
• 17:51
  Speaker 2: your business, like, find that partner that is able to
• 17:55
  Speaker 2: adhere to your goals and objectives across all different functions
• 17:59
  Speaker 2: within your organization and is an extension of your organization
• 18:02
  Speaker 2: to provide those insights and be the industry leader in
• 18:05
  Speaker 2: letting you know what's going on within their company so
• 18:08
  Speaker 2: you can better speak to your partnership when you're sitting
• 18:11
  Speaker 2: in front of regulators and so on and so forth. Yeah.
• 18:14
  Speaker 3: So I mean Upstart is partnering with more than one
• 18:16
  Speaker 3: hundred credit unions and banks. Now, so what are some
• 18:19
  Speaker 3: of the key tips that you have for success when
• 18:21
  Speaker 3: you're partnering with financial institutions.
• 18:24
  Speaker 4: I can say that my former credit uni was also
• 18:26
  Speaker 4: an out there partner, so I had seen it from
• 18:29
  Speaker 4: the implementation side, from the crediting perspective, and now coming
• 18:33
  Speaker 4: into off starting and delivering it. This gives me a
• 18:36
  Speaker 4: holistic view of how effectively implement a program like this.
• 18:41
  Speaker 4: But I think the biggest learning that I've had is
• 18:44
  Speaker 4: that we try and encourage our lending partners to start
• 18:47
  Speaker 4: small and really let's get the pipe built. Let's run
• 18:50
  Speaker 4: a little bit of water through the pipe. Let's make
• 18:53
  Speaker 4: sure that from a reporting standpoint, everything is working efficiently
• 18:56
  Speaker 4: on the back end, how that new membership is on
• 18:58
  Speaker 4: board on your for the accounting is looked after, the
• 19:02
  Speaker 4: compliance and regulatory aspects are looked after from the risk
• 19:05
  Speaker 4: folks within the credit union. And let's get a few
• 19:08
  Speaker 4: loans under your books and let's see how they perform
• 19:11
  Speaker 4: early and really understand how that flow of information is
• 19:15
  Speaker 4: coming through and how we can be efficient on the
• 19:17
  Speaker 4: back end so that it doesn't become a burden on
• 19:19
  Speaker 4: the operations folks when you're bringing in all these brand
• 19:21
  Speaker 4: new members. But from there, once you realize that working
• 19:25
  Speaker 4: pretty well, it's working efficiently, let's scale it. The nice
• 19:29
  Speaker 4: thing with our program is there's a lot of configurability
• 19:32
  Speaker 4: options available for the crediting so they can expand their
• 19:36
  Speaker 4: credit box, that can shrink it as their business needs changed.
• 19:39
  Speaker 4: You can raise or lower the volume as needed for
• 19:42
  Speaker 4: your program. Your net return is something that you are
• 19:46
  Speaker 4: providing to us as opposed to outstart saying that we
• 19:49
  Speaker 4: will provide that return. You're seeing what your net return
• 19:53
  Speaker 4: options are necessary for your business, and then we help
• 19:56
  Speaker 4: to deliver a portfolio that will meet those that is subjective. Well,
• 20:00
  Speaker 4: that was kind of my biggest learning, I think, from
• 20:02
  Speaker 4: both sides of the desk. With the accent relationship.
• 20:05
  Speaker 2: Yeah, I can't say that I was partnered with Upstart
• 20:08
  Speaker 2: at my prior credit union. But one thing I will
• 20:10
  Speaker 2: add is, even from the early onset of the discussion
• 20:13
  Speaker 2: with partnering, it's important to get executive buy in, not
• 20:18
  Speaker 2: just the lending folks. It's imperative to get board buy in.
• 20:22
  Speaker 2: And then once you do go forward with some form
• 20:24
  Speaker 2: of AI driven partnership, bring all the teams into it
• 20:28
  Speaker 2: as well, look at credit risk committee, bring in the
• 20:31
  Speaker 2: legal compliance, so on and so forth. And even though
• 20:33
  Speaker 2: they're not touching it every single day in some capacity,
• 20:35
  Speaker 2: at least they have a general sense of what is
• 20:38
  Speaker 2: being done. So when you get to that portion of
• 20:41
  Speaker 2: what Barry was talking about of scaling, everybody within your
• 20:44
  Speaker 2: organization is comfortable with the partnership, is comfortable with the
• 20:47
  Speaker 2: potential to scale, and then being able to monitor on
• 20:50
  Speaker 2: the back end as things have increased.
• 20:53
  Speaker 4: Yeah, including the board, right, Drew. I mean we've actually
• 20:56
  Speaker 4: spoken to board members in the past, We've had credit
• 20:59
  Speaker 4: unis and by this in board meetings so that we
• 21:01
  Speaker 4: can help to explain the merit of the program, the
• 21:04
  Speaker 4: bafans of the program, and some of the risks of
• 21:06
  Speaker 4: the program. I mean, I think we need to be
• 21:08
  Speaker 4: fully frank parented to all elements of the program that
• 21:12
  Speaker 4: hopefully will become successful for the crediting and if there
• 21:15
  Speaker 4: are success measures that may not be met, how it
• 21:18
  Speaker 4: is that up there can help to get the program
• 21:21
  Speaker 4: back on track because we may enter into a partnership
• 21:25
  Speaker 4: with a certain expectation and if the explication is met.
• 21:29
  Speaker 4: I mean, this is where really where Drew and I
• 21:31
  Speaker 4: were making our money, because we are the ones who
• 21:33
  Speaker 4: are coming in to help with our crediting partners and
• 21:37
  Speaker 4: explain what's happening with the program and to make sure
• 21:39
  Speaker 4: that we have the tools available in order to make
• 21:43
  Speaker 4: it as successful as possible for them.
• 21:45
  Speaker 2: Yeah. I would add to like when you fast forward
• 21:47
  Speaker 2: and you're partnered with any type of partnership vendor, like
• 21:51
  Speaker 2: make sure you stay updated on what's going on too.
• 21:53
  Speaker 2: From an education perspective. This wave of AI has evolved
• 21:57
  Speaker 2: over the past six months more than it has in
• 21:59
  Speaker 2: the past two years. Businesses, as does the credit union
• 22:04
  Speaker 2: listeners here like you have to pivot your organization to
• 22:07
  Speaker 2: meet specific goals and objectives. Your partners are going to
• 22:10
  Speaker 2: do the same thing. So as much as you know
• 22:12
  Speaker 2: about your partners when leveraging AI, the better suited you
• 22:16
  Speaker 2: will be when there are pivots within the organization to
• 22:19
  Speaker 2: make more accurate decisions of how you want to leverage
• 22:22
  Speaker 2: your partner in future years.
• 22:25
  Speaker 3: Yeah, you couldn't be more right about that. The advances
• 22:27
  Speaker 3: that we're going to see in the next couple of
• 22:28
  Speaker 3: years were moving so much faster than we were even ten, fifteen,
• 22:32
  Speaker 3: fifty years ago. Yeah, before we end today, any final
• 22:36
  Speaker 3: words of advice to our audience, just to really summarize
• 22:40
  Speaker 3: that how to win in twenty twenty four concept.
• 22:43
  Speaker 4: So I'll say with AI. Upstart has an animule meeting
• 22:47
  Speaker 4: where we bring our any partners together and we network
• 22:49
  Speaker 4: and we talk about advances in the industry and in
• 22:53
  Speaker 4: AI and so on. And we have a speaker come
• 22:55
  Speaker 4: in to our conference last year and you spoke about AIS,
• 23:00
  Speaker 4: not necessarily how you're using AI, it's really making sure
• 23:04
  Speaker 4: that you're being ahead of this because your competitor may
• 23:08
  Speaker 4: already be down the road in using the AI and
• 23:10
  Speaker 4: you don't necessarily know. So it's almost like for those
• 23:13
  Speaker 4: of you who are around in the nineties and the
• 23:15
  Speaker 4: Internet came on and a lot of people really struggled, Well,
• 23:18
  Speaker 4: the Internet, this is great, but how are we going
• 23:20
  Speaker 4: to use this? What's the business used for this? And
• 23:22
  Speaker 4: I think we've all learned that now that in the
• 23:25
  Speaker 4: twenty twenty is that that connectedness and the on demand
• 23:28
  Speaker 4: and the ability to transact business and to connect with
• 23:31
  Speaker 4: others is if we.
• 23:32
  Speaker 6: Didn't have it, we couldn't do the things we're doing
• 23:34
  Speaker 6: right now. And I think AI is going to have
• 23:38
  Speaker 6: that much an effect, possibly even more, because it's going
• 23:40
  Speaker 6: to make those day to day pats so much more
• 23:43
  Speaker 6: efficient and those decisions that have to be made and
• 23:46
  Speaker 6: in upstart S case, we're talking about under a decision.
• 23:49
  Speaker 6: It will be using more and more data and get
• 23:51
  Speaker 6: into a more granular site way of decision making and
• 23:56
  Speaker 6: you don't have to jump in with both feet on this.
• 23:58
  Speaker 6: I mean, I think this is where Upstart, having been
• 24:01
  Speaker 6: in this business for over a decade, and having a
• 24:04
  Speaker 6: lot of training data and a lot of experience with.
• 24:06
  Speaker 4: This is a good introduction for AI into creditings who
• 24:11
  Speaker 4: may not even know where to start. This is not
• 24:13
  Speaker 4: chat GPP, not where you ask a question and we
• 24:16
  Speaker 4: will give an answer to this impactful business use case
• 24:19
  Speaker 4: where we are you liedes and machine learning and artificial
• 24:22
  Speaker 4: intelligence to provide better decision making for you. And as
• 24:26
  Speaker 4: Upstart goes out and talks to prospective credit unions about this,
• 24:30
  Speaker 4: I think that's been very appealing for them, even more
• 24:32
  Speaker 4: so now because AI has become such a prevalent topic,
• 24:36
  Speaker 4: not just in business but in society.
• 24:38
  Speaker 2: Now, that's good. I'll expand a little bit off of
• 24:40
  Speaker 2: that and kind of close out here with the reoccurring
• 24:43
  Speaker 2: theme of our conversation today has been partnering with the
• 24:47
  Speaker 2: right partner that can help your organization stay ahead of
• 24:49
  Speaker 2: the curve and actually lead the conversation within your credit
• 24:53
  Speaker 2: union when it comes to the impact of AI. So
• 24:55
  Speaker 2: I'm going to make a quick plug here to the listeners.
• 24:58
  Speaker 2: Upstart has released an AI certification and financial services program
• 25:02
  Speaker 2: back on May first. This is a first of its
• 25:05
  Speaker 2: kind AI certification program for executives in the financial service industry,
• 25:09
  Speaker 2: and you can think of this course as an online
• 25:12
  Speaker 2: master style class being led by upstarts, executives and experts
• 25:16
  Speaker 2: within each field. The program is currently opened and relevant
• 25:19
  Speaker 2: to anyone within the industry looking to get smarter and
• 25:22
  Speaker 2: more informed on AI and how, where and why it
• 25:25
  Speaker 2: applied to the credit union industry. For now, we are
• 25:28
  Speaker 2: providing this for free. I've had the privilege of taking
• 25:30
  Speaker 2: the course. It's an exceptional opportunity to learn about AI
• 25:33
  Speaker 2: from a broader sense on how it's leveraged in lending
• 25:36
  Speaker 2: to further advanced ones knowledge for personal development and professional growth.
• 25:40
  Speaker 2: If you're interested, we'd love for you to register at
• 25:42
  Speaker 2: upstart dot com forward Slash AI hyphen Certification.
• 25:46
  Speaker 3: Yeah. I think that's a really useful course for folks
• 25:49
  Speaker 3: to look into. We'll make sure to put a link
• 25:50
  Speaker 3: to that in our show notes as well. Well, Barry Drew,
• 25:53
  Speaker 3: we covered a lot today. I just want to thank
• 25:55
  Speaker 3: you both so much for joining us to share your insights.
• 25:57
  Speaker 2: Thank you, it's been a pleasure.
• 25:59
  Speaker 4: Thank you. Malin appreciates the time.
• 26:01
  Speaker 3: Yeah, and thank you to everyone for listening. And if
• 26:03
  Speaker 3: you're interested in learning more, you can check out resources
• 26:06
  Speaker 3: at www dot NAFQ dot org forward slash Upstart have
• 26:10
  Speaker 3: a great day everyone.
• 26:11
  Speaker 7: Upstart partners with banks and credit unions to grow households
• 26:14
  Speaker 7: and expand consumer lending through its leading AI lending platform.
• 26:18
  Speaker 7: Upstart powered banks and credit unions leverage AI to offer
• 26:22
  Speaker 7: higher approval rates and experience lower loss rates while simultaneously
• 26:26
  Speaker 7: delivering the exceptional digital first lending experience that consumers demand.
• 26:30
  Speaker 7: Whether you're looking to grow and enhance your existing personal
• 26:33
  Speaker 7: and auto lending programs or you're just getting started, Upstart
• 26:37
  Speaker 7: can help. Upstart offers an end to end solution that
• 26:40
  Speaker 7: can help you find more credit worthy borrowers within your
• 26:43
  Speaker 7: risk profile with all digital underwriting, verification, loan closing, and servicing.
• 26:49
  Speaker 7: It's all possible with Upstart in your corner. Learn more
• 26:52
  Speaker 7: about finding new borrowers, enhancing your credit decisioning process, and
• 26:56
  Speaker 7: growing your business by visiting upstart dot com slash lenders.
• 27:00
  Speaker 7: That's upstart dot com slash slenders