Artificial intelligence can help auto lenders streamline compliance while making operations more efficient.
Here are two ways lenders are using AI to improve their operations:
1. Combat human error
Subprime auto lender based in Santa Ana, California Veros Credit studies how to use AI-based programs to improve compliance across the organization and reduce human error, Harvey SinghCOO, said during a webinar on the impact and uses of conversational AI hosted by the fintech Skit.ai September 19th.
“Once AI is properly programmed and understands what the rules and guidelines are based on our internal and/or regulated policies that we have in place, it not only saves time for the customer, but it also reduces human error, which will help us stay compliant,” he said. “This is a key initiative for us and allows us to do more with less without making mistakes.”
Subprime lender based in Irving, Texas Same Day Car Financing East using AI-based programs to handle consumer calls in a way that mimics the way humans interact with customers, Armando Hidalgomaintenance manager, said during the webinar. “It really helped a lot with respect to compliance and making sure that all the checks and validations…were all checked,” he said.
SameDay regularly updates its AI-based algorithm to ensure the organization meets ethics and accountability requirements, Hidalgo said.
2. Reduce costs
AI can help reduce costs associated with human error and automate tasks, Singh said.
“AI helps us stay compliant with lending regulations and reduce the risk of costly mistakes because we’ve programmed it,” he said. “When a human is talking to a customer, there are things that come up that we shouldn’t say, or something … might be taken out of context. From the AI’s perspective, it’s going to say what’s programmed. We’re constantly monitoring to make sure the robot is behaving as it should.”
AI-based tools can also help lenders automate routine tasks, while shifting better-used resources to tasks that require strategic decisions and manual processes, Singh said.
“We will always need humans to make certain decisions that a robot (AI) will never be able to make,” he said.
In addition to AI helping lenders stay compliant, compliance needs to be a top of mind when integrating these AI-powered tools, Singh said. At Veros Credit, compliance and quality assurance teams listen to calls and identify adjustments that need to be made, he said.
“Accuracy is key,” Singh said.
Auto Finance Summit, the premier event for the automotive lending and leasing industry, returns October 7-9 at Wynn Las Vegas. To learn more about the 2024 event and to register, visit www.AutoFinanceSummit.com.