2 ways AI can assist lenders with compliance 

Artificial intelligence can help auto lenders streamline compliance while making operations more efficient.  

Here are two ways lenders are employing AI to improve operations:  

1. Addressing human error 

Santa Ana, Calif.-based subprime auto lender Veros Credit is looking at how to use AI-based programs to improve compliance across the organization and cut down on human error, Harvey Singh, chief operating officer, said during a webinar on conversational AI impact and uses hosted by fintech Skit.ai on Sept. 19.  

“Once we have the AI programmed correctly and it understands what are the rules and guidelines based on our internal and/or regulated policies we have put in place, it’s not just saving time for the customer, but also reducing human error, which will help us stay in compliance,” he said. “That’s a key initiative for us and how we can do more with less without making any errors.” 

Irving, Texas-based subprime lender SameDay Auto Finance is using AI-based programs to handle consumer calls in ways that mimic how humans interact with customers, Armando Hidalgo, director of servicing, said during the webinar. “That really helped a lot as far as compliance, and making sure that all the verifications and validations … were all checked off,” he said.  

SameDay regularly updates its AI-based algorithm to ensure that the organization is meeting requirements around ethics and responsibility, Hidalgo said. 

2. Reducing costs 

AI can help reduce costs associated with human mistakes and assist with automating tasks, Singh said.  

“AI helps ensure we stay compliant with lending regulations and reduce the risk of costly mistakes, because we programmed it,” he said. “When a human is speaking with a customer, some things come up that we shouldn’t be saying, or something … could be taken out of context. From an AI perspective, it’s going to say what is being programmed. We are constantly monitoring to make sure that the bot is behaving the way it should be.” 

AI-based tools can also help lenders automate routine tasks, while shifting resources better used for tasks that require strategic decisions and manual processes, Singh said.  

“We’re always going to need humans to make certain decisions that [an AI] bot will never be able to get,” he said.

In addition to AI helping lenders remain compliant, compliance must be front of mind when integrating those AI-based tools, Singh said. At Veros Credit, compliance and quality assurance teams listen to calls and identify needed adjustments, he said.  

“Accuracy is key,” Singh said. 

Auto Finance Summit, the premier industry event for auto lending and leasing, returns Oct. 7-9 at Wynn Las Vegas. To learn more about the 2024 event and register, visit www.AutoFinanceSummit.com.