Ally Financial Inc., one of America’s largest auto lenders, is speeding up automated processes for auto loan origination and leasing. The change signals growing confidence in the company’s underwriting tools and the financial stability of its customer base amid the ongoing coronavirus pandemic.
Ally CFO Jenn LaClair said last week that the Detroit lender was revitalizing its automated decision-making program after slashing some of those processes due to economic uncertainty caused by the virus.
Automated decision-making, which is a banking system that processes an auto loan application without human intervention, determines creditworthiness, and extends a loan offer or denies the request. The process is “faster and helps our dealers and their end consumers make quick decisions,” said LaClair. “As we were going through COVID, we took a break simply because we wanted to do some extra due diligence in our underwriting process, especially when it comes to employment. “
Automated decision making saves finance and insurance office time, especially for clients with very high or very low FICO scores. Not all customer credit situations can be determined quickly, which is why auto lenders say a number of human underwriters are needed.
Ally processed 12.1 million auto loan and rental applications in the fourth quarter, thanks to a slight increase in automatic decision making and “advanced data analytics.”
“It’s our confidence in the performance of the business, the tools at our disposal and, ultimately, the consumer as well,” said LaClair.
As economic uncertainties plague the auto lending environment, auto finance companies appear upbeat and willing to increase the use of tools that drive faster auto loan and lease decisions, especially for consumers. having higher credit levels.