FICO scores are so last year
Upstart’s D2C loan algorithm utilizes AI and Machine Learning (AI-ML) to analyze more comprehensive data inputs (e.g., work history, education, area of study) and identify loan recipients, sizing and rates. Most of those recipients are college grads, ages 28-35.
The startup also uses AI for fraud monitoring and automated approval processes (…Tossing out credit scores AND the need for human contact? They clearly know their millennial target base).
LaaS(t) but not least…. on the lender side, banks and credit unions can utilize Powered by Upstart, a Lending-as-a-Service platform, to apply Upstart’s risk modeling and automation to their own personalized, unsecured installment lending programs.
Peer-to-Peer lending is trending
But Upstart is feelin’ pretty good: Since its 2012 inception, the company has originated $3.3B in loans and claims loss rates of less than half of those of other platforms.
According to VB, they have been profitable since 2018 and plan to continue expanding their partnerships and service offerings.