WASHINGTON—A great deal has taken place since just a year ago when Origence was still in the process of fully rolling out a new CUSO that expands its lending expertise with auto loans to a broader array of lending, this time at the point of sale—with developments that include new lending channels and greater use of AI on the backend to boost “straight-through” loans.
The CUSO, FIConnect, connects borrowers, retailers and credit unions by seeking to embed CUs in the purchase process as part of a strategy the company has prioritized—being “top of funnel.”
A year later, Origence is expanding into new areas of borrowing, including construction lending, and says other announcements are coming. The company’s CEO, Tony Boutelle, sat down with the Credit Union Daily during America’s Credit Unions’ GAC. Here is some of what he shared.
The CU Daily: There has been a lot of growth in FIConnect since one year ago at GAC. What can you tell us about that?
Boutelle: FIConnect is our embedded finance concept. It’s actually trying to help credit unions get on websites and places where car shopping could start, such as with Tesla and Lucid. We are embedding our financing in the sales process, and that is going pretty well. We’ve had Tesla for a while and that’s actually ramping back up. The banks actually had been very aggressive with Tesla; that kind of cooled off last year, but now it’s coming back and we’re seeing a lot more Tesla loans.
When it comes to new channels, there is definitely a lot going on there.
The CU Daily: In addition to the auto lending, FIConnect also does numerous other things, correct?
Boutelle: FIConnect was just auto loans. Last year, we started doing home equity loans. This year we will work with some construction companies and we are starting to do some loans with them…Our teams are talking to all of our credit unions about how to get signed up for these kinds of things. Really, if you sign up for FIConnect and get the integration, you can then add other channels like Tesla. You can say, ‘I want this one,’ and there is this one-pager to turn it on. It’s a lot easier.
The CU Daily: To clarify, FIConnect is the retail-facing piece and Origence is the backend, credit union-facing piece?
Boutelle: Origence Lending Services is the one in the back-office processing that we do in Colorado. With FIConnect and all of the different companies that we make these deals with, they want consistent processing and SLAs and things like that. We have all of it done through Origence Lending Services. Every different credit union has different kinds of ways of getting that loan back to the consumer. But it’s our rates that the credit union agrees to, and it’s their loan and their member that they now get to market other things to.
The CU Daily: How does the member see and experience this? Is it immediately branded to the credit union?
Boutelle: The member does not at first see the loan branded to their credit union. At first they see, ‘You’re getting a loan at this rate. Congratulations, you’re now a member of Golden 1 Credit Union.’ And it’s literally within probably a minute after the approval, in this case Tesla or whoever it is accepts the loan, because they’re part of the process. But it is very, very soon. Again, we fund it on behalf of that credit union and we do all the paperwork to get them set up and we onboard it to the credit union’s data processing.
The CU Daily: What is your ramp-up to get into position to do construction loans, which can be complex?
Boutelle: It’s taken a year to 18 months for each one. (Currently), they don’t embed (lending) in the process. They go outside and then somebody gets a loan…We’ve got to put our tech into the platform and as they go through the shopping process be able to show that they’re approved for that loan. Then (the consumer has) got to ask for the loan and they’ve got to actually say, ‘I do want this loan.’ It’s a lot of negotiation and a whole lot of integration with each one.
The CU Daily: Are all of these construction loans indirect loans?
Boutelle: We use retail installment contracts that can be resold. We own it for a couple of minutes and then we sell it to the credit union, just like a dealer does. We’re having to use those types of contracts. With most direct loans you can’t really sell a direct loan. They’re on a piece of paper that’s written for them.
The CU Daily: Of all that is going on with Origence, what is one thing you would like CEOs and credit unions to be aware of?
Boutelle: I think what they should know is that as a CUSO owned by credit unions we are 100% looking out for how to keep credit unions relevant. We are very much investing in indirect lending and direct lending like we always have. We think those channels are always going to be around. But the new channels are all of these new players where we want to put the loan in the process, whether some kind of home equity loan or some kind of car purchase that you’re doing online. There are a lot of places where that’s happening today, and embedding it ahead of time, before they even get to the dealer, is, I think, the new kind of future of where lending is going.
All (of the channels) are going to be important. We’ve seen credit unions grow up. It was just the branch at one point, then it was the phone and then the Internet. It’s the same thing, and all these channels have to be managed. You need to think about how you bring that into your credit union and manage each one of them and have an opportunity to see where your members are getting their loans.
The CU Daily: Agentic AI has allowed people to outsource their thinking. How does it affect lending?
Boutelle: It’s going to have a huge effect on lending. We’re using a lot of AI today. It’s really more of the processing. Never say never in something like this, and there’s probably going to be a point where maybe Claude or one of those models could go out and get you a loan, but right now they can get you a lot of information.
There’s a lot of compliance. There’s a lot of process. There are a lot of regulations that would be really hard to AI, I guess you could say. Our goal by the end of this year is to have straight-through processing, meaning that no human is really looking at the loan. We’re using AI and a decisioning system that we’ve been developing that we’re going to bring out to the marketplace so that we can create as much efficiency as possible, and quality, too. Even though humans are great, they’re going to make errors. We have to test this and make sure that it’s going to work, but we are very much focused on it.
We’re seeing a lot of credit unions actually implement some of this now, and some of these credit unions will have 50% of the loans they do that they don’t touch because of AI. They just hit ‘Fund’ at the end. It’s definitely having a huge impact on lending.
