ZestFinance, an artificial intelligence-based underwriting company, is preparing for its entrance into the powersports sector as the company continues its “deep” discussion with one powersports lender, Powersports Finance has learned.
The company is currently in talks with several lenders — mostly auto lenders — and these talks are “qualified and deep discussions,” Douglas Merrill, co-founder and chief executive of ZestFinane, told Powersports Finance.
“I think [powersports lending] would be very well served by real machine-learning underwriting,” Merrill said. So far, the company has found the powersports lending space to be a bit “weird,” he said, because of missing data and that some customers have more complicated credit.
That being said, “it ‘ought to be a really great place to increase approval rate while reducing risk by underwriting more effectively,” he added.
ZestFinance, founded in 2009, applies big data and machine learning to credit underwriting. Most recently, the company concluded a study with Ford Motor Credit Co. that measured the effectiveness of machine learning to better predict risk.
“Our business is unique in that our proprietary machine-learning underwriting platform, ZAML, can turn data from any source — including messy or erroneous data — into highly predictive credit decision information,” Merrill previously said.