Point Predictive, the AI company that increases trust in lending, announced today that Westlake Financial, one of the nation’s largest auto lenders, adopted IncomePass™ to create a more streamlined lending experience for its dealers and borrowers that substantially reduces fraud and early payment default exposure. IncomePass identifies income misrepresentation on loan applications using advanced data science, allowing lenders to save review resources by focusing extra diligence on riskier auto loan applications.
IncomePass was developed using Point Predictive’s patented Ai+Ni scoring approach, which was shown to reliably clear Westlake applicants’ stated incomes during extensive historical testing. Ultimately, Westlake Financial moved forward with Point Predictive because tests proved that it was possible to better detect income misrepresentation while subjecting a smaller pool of higher risk loan applications to additional documentation and verification requirements.
IncomePass provides a real-time assessment of an applicant’s stated income, which allows lenders to limit costly and time-consuming stipulations from low-risk borrowers. IncomePass consists of a risk score and a detailed report with dozens of associated risk factors that can be integrated with origination systems or delivered to review specialists. The product was launched in 2020 and draws upon the highly regarded Point Predictive fraud data consortium.
“Westlake Financial is committed to delivering the smoothest borrower experience possible while simultaneously managing our loan portfolio’s risk to the lowest levels possible,” said Ian Anderson, Group President at Westlake Financial. He added, “We’re excited to take advantage of this unique consortium approach and an innovative application of data science. IncomePass is a win-win; we more easily manage risk and provide access to credit for borrowers who get funded faster.”
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Tim Grace, CEO of Point Predictive, thanked Westlake Financial for their participation in the consortium approach. “Innovation-minded consumer finance organizations like Westlake Financial are natural fits for Point Predictive solutions because they know that a collaborative approach, coupled with advanced data science, is the best way to stop fraud,” he said. “IncomePass addresses income misrepresentation, the most prevalent U.S. auto loan risk that is present on about 30% of all early payment defaults,” he added.
“We encourage lenders to do a head-to-head comparison between IncomePass and their current income verification strategies, then measure which products successfully identify inflated incomes,” said Frank McKenna, Co-Founder and Chief Risk Officer at Point Predictive. “Many lenders are surprised to discover that requesting paystubs on 100% of their applicants isn’t stopping fraud as effectively as they thought. Furthermore, solutions like The Work Number™ could leave lenders without income verification on 70% of their application volume,” he added.
Only a portion of the employed population works for organizations that share their employees’ information with traditional data solution providers. Traditional data vendors, therefore, cannot meet match rate expectations that justify their cost in the fight against fraud. Point Predictive, by contrast, makes real-time income predictions on every single application based on more than 94 million previous loans plus reported income data from the Internal Revenue Service, US Census, and confirmed prior fraud and default databases.
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