CUDL eyes universal credit app, finance growth in 2024

Credit union lending network CUDL expects financing volume to grow in 2024 on the heels of underwriting technology improvements and geographical expansion. CUDL is planning to launch a universal credit application and an e-contracting solution this year, Josh Amaton , vice president of dealer client experience at parent company Origence , told Auto Finance News on Feb. 2 at the National Automotive Dealers Association Show in Las Vegas. “Once [dealers] secure financing, they will be able to print out a credit application for that particular member loan,” he said. “Some of our credit unions have their own [application] and the dealers can do that now, but [there isn’t] a universal credit application that would be able to be accepted by all credit unions.” The planned upgrades follow several technology initiatives CUDL undertook in 2023, including adding document process automation, Amaton said. The credit unions can “use AI to stack those deals, read those deals, and much more efficiently and quickly fund those deals,” he said. CUDL is also working on an initiative this year called Collect.IQ to allow dealers to submit loans via their smartphones and the credit unions to accept the deals digitally, Amaton said. Some of CUDL’s credit union clients also are using Origence and Zest AI’s automated underwriting model, Zest Auto, to tap into the full spectrum of borrowers, Amaton said. “That means more financing approvals for our dealer partners,” he said. Tightened lending The fintech’s network of 1,100 credit unions funded $46.7 billion in auto loans through CUDL in 2023, according to a company release. By comparison, CUDL helped fund about $59 billion in auto loans in 2022. Some credit unions scaled back auto lending in 2023, especially in new-vehicle financing, as captives offered incentives, Amaton said. “We saw some credit unions pulling back this past year due to liquidity challenges . There were a few credit unions that still had an appetite for auto lending, so we introduced them to our dealer partners and helped them create new relationships,” he said. “Credit unions ... focused on pre-owned vehicles, so we saw great pre-owned auto lending all of last year with our credit unions.” On the underwriting front, credit unions tightened their guidelines in 2023, Amaton said. “Towards the end of 2023, [credit unions] saw delinquencies on the rise; they’re also keeping a close eye on layoffs we’re seeing happening across the country,” he said. Financing volume to grow CUDL expects financing volume to pick up in 2024 as credit unions loosen their financing standards, Amaton said. “In 2024, as liquidity challenges [ease] and credit unions gain more deposits, it's going to be better for our dealer partners [as we see] easing of the lending guidelines that some of the credit unions put in place last year,” he said. “There is an opportunity on the horizon for more lending.” CUDL’s network expanded in 2023 to include a total of 20,000 dealerships in the United States, with more growth in the works, Amaton said. "We're looking to expand the selection of credit union lenders that a dealer would have access to in other markets where we don't have as much penetration as we do in others,” he said. “There’s a big focus to find new credit union partners, introduce them to our dealer network, and then add additional dealers in markets where we haven't yet expanded.” Amaton didn’t provide specific market expansion plans but said CUDL is looking at “select pockets where we don't have credit unions that lend in certain areas due to their charter restrictions or membership restrictions” across the nation. Credit unions have funded $458 billion in loans through CUDL’s platform since the company was founded in 1994, according to the company release. 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CUDL eyes universal credit app, finance growth in 2024

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