Point Predictive Inc.: Using a Unique Combination of Artificial And Natural Intelligence To Address Fraud Risks

Point Predictive

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Some verticals or industries may be more vulnerable to fraud than others, but no business is absolutely risk-free. High volumes of fraud can harm a company, leading to both sales and reputation losses. Therefore, it is necessary to have measures in place to safeguard against potential fraud and misrepresentation. Moreover, in today’s changing environment, companies will soon be facing considerable challenges managing rising rates of fraud and misrepresentation while balancing growth of their loan portfolios. This is where Point Predictive provides tremendous value to lenders.

Established in 2017, Point Predictive is the brainchild of a team of global fraud prevention solution executives who gained experience by working in leading organizations such as HNC Software, FICO, ID Analytics, BasePoint Analytics, CoreLogic and Fiserv. The company’s mission is to help lenders stop fraud and misrepresentation losses with a broader goal of transforming the way lenders establish trust with their customers so they can fund more loans, faster and easier than ever before.

Delivering A Wide Range Of Solutions, Uniqueness of Point Predictive

When a consumer submits a loan to a third party or lender, they are often subject to a wide variety of requests for documentation and verification to prove their claims on the application. This is where Point Predictive technology is extremely valuable to ensure that those applicants who provide reliable, authentic, and accurate information are not inconvenienced and to provide lenders an ability to fund those loans faster and easier. To prevent fraud-related and misrepresentation-related early payment default losses, the company offers fraud, risk, and loan streamlining solutions to the auto, mortgage, retail, and fintech lending industries.

These solutions enable lenders to fund more loans using a patented combination of Artificial and Natural Intelligence [Ai+Ni] that powers machine learning risk assessments for lending decisions. The company’s flagship product, Auto Fraud Manager, is one of the prime examples of a solution delivering compelling value to automotive lenders and car dealerships. The solution scores millions of automotive loan applications each month. It helps lenders across the nation reduce their losses on the riskiest applications by 30% or more while streamlining another 30% or more of their applications to improve loan pull-through and profitability.  It also gives lenders an earlier indication of dealer behavioral risk than any other solution available today.

What sets Point Predictive apart from others is that its solutions allow greater automation across more applications resulting in more accurate results with less fraud or material misrepresentation escaping unnoticed. Most other application fraud solutions available today focus almost exclusively on verifying identity—is the borrower who they say they are? Point Predictive is different and goes beyond this narrow approach by providing a comprehensive risk assessment of everything on the application—i.e. income, collateral, employment and identity—in the context of its nationwide fraud and misrepresentation consortium data. This provides lenders with the most trust metrics of any solution, enabling them to make a fully-informed risk decision about each application.

The CEO of Point Predictive, Tim Grace asserts, “Typically, less than 3% of all credit-qualified loan applications contain fraud or material misrepresentation. Identifying the 97% that can be funded safelywithout unnecessary verification, tedious consumer proof documents, or risk of fraud due to material misrepresentationis why lenders use solutions from Point Predictive.

The Multi-Faceted Leader With Global Technology And Risk Management Experience

Tim is a strategic innovator, having led the development of several revolutionary products in the financial services, payment card, and mortgage industries.  He and a fellow co-founder kept hearing the same tales about significant inefficiencies in the consumer lending application experience across mortgage, automotive, and retail.  Potential customers with excellent credit scores, long histories, and solid financial positions were being asked to provide multiple separate verifications of information on their application – they realized there must be a better way to both prevent fraud and streamline good applications. This idea was the foundation behind the formation of the company.

As CEO, Tim’s role is to keep the company’s day-to-day, month-to-month, and year-to-year activities going in the right direction for everyone to thrive. To achieve this, he develops the strategy, builds the team around him that can see that through, and then leads that team to create the products and solutions that will help Point Predictive serve its customers more efficiently. He says, “The most important thing I do for our team is ensure that they know how their individual contributions support our corporate goals.  Our investors and our customers both expect great things from our company – each team member is essential to making that happen.”

Connecting With The Team On Various Communication Platforms 

Tim believes that motivation comes from within, from achieving something more than you achieved yesterday. So, he keeps his teams motivated by continually pushing them to go beyond the status quo. During these tough times, he has implemented a completely remote work environment with new initiatives around “connecting” with each other in meaningful ways. That means every meeting and every call is done on video. The teams frequently meet throughout the day—on Slack, on Zoom, on GoToMeeting—to mimic, as closely as they can, the environment of working together in an office.

Enhancing Their Ai Capabilities To Develop New Solutions

For the past 25-30 years, Artificial Intelligence has been used as a core tool for decision making in financial services. Though tremendous steps have been made during that time, each year the pace of progress continues to increase faster and faster. Tim believes that infusing machine learning with natural intelligence to provide actionable predictions that make sense is critical for the continued expansion of Ai in financial services.

Point Predictive applies this unique approach to Ai solutions for the financial industry. Its decades of risk management experience ensure that its Ai is actionable and effective for fraud detection and misrepresentation across all types of consumer lending. By combining Artificial + Natural Intelligence [Ai+Ni], Point Predictive carefully develops and tests machine learning models that help lenders confidently know whether information on a loan application is true and accurate, or whether the loan application contains information that is misrepresented or materially inaccurate. Human (natural) experience is then incorporated into these Machine Learning models, resulting in unrivaled recognition of true and accurate loan applications. This results in more loan approvals, faster, with reduced documentation and verification requirements. Point Predictive’s technology helps lenders profitably grow their loan portfolios while reducing losses related to misrepresentation and fraud.

Point Predictive

New Projects for the balance of the year

In the second half of 2020, Point Predictive will launch innovative new technologies in fraud and risk solutions to serve more than 50,000 new and used car dealers in the US. These solutions will provide dealers with a way to access the same Ai used by lenders to avoid fraud and misrepresentation, all while the customer is still in the dealership’s finance office. Dealers who lead the way in proactive fraud prevention efforts will be in a better position to enjoy preferential terms with lenders on loans or other opportunities. For lenders, the company is launching a new Unemployment Checker solution, which will provide a direct verification of a borrower’s unemployment claim status during the application process.

Pandemic Effect On The Market

COVID-19 is impacting every industry and vertical served by Point Predictive. For example, auto lenders have been originating fewer loans since borrowers and car dealerships are both affected by state-mandated lockdowns; those applications that they are receiving exhibit a higher risk profile—fraudsters never miss an opportunity.

Tim believes that the combination of lower origination volumes and an increasing borrower risk profile will lead to higher overall rates of fraud across auto, mortgage, and retail lending. Fraud can remain at manageable levels in healthy markets since high numbers of performing loans mask it. As market conditions become unfavorable, originations drop while attempts at fraud persist or even increase. This has the effect of increasing the overall effect of fraud on the bottom line. Furthermore, as volumes start to increase rapidly after the pandemic eases, fraudsters will almost certainly take advantage of this backlog to slip through potential gaps in risk management processes. Point Predictive can help lenders to stay ahead and avoid risks that are a natural byproduct of this crisis.

Point Predictive

New Challenges to Emerge

As the economy begins to reopen and lending volumes increase, we expect lenders will be dealing with a different world.  An example of that will be the high rates of unemployment and how that impacts borrower affordability.  How can a lender confirm a borrower is employed and if they can afford the loan?” Tim commented further. He believes this question is much harder to answer than it was before the pandemic with the high rates of unemployment we are experiencing in today’s market.

As a leading Ai company, Point Predictive is planning for that by piloting a new service that will help lenders identify those borrowers that might not be providing accurate information about their current employment situation so lenders can make informed decisions on those applications. It has also offered no-charge access to its Synthetic Identity Alert service to all auto lenders as its way of “giving back” to the hard-hit auto lending community through the end of 2020.

A Piece of Advice

As a seasoned entrepreneur, Tim offers his advice to aspiring entrepreneurs who want to thrive in the industry. He suggests they focus on making sure their product or solution delivers value to customers that they will pay for.  He further states, “Every entrepreneur believes in their product and has lofty dreams, but you have to ensure you focus everything your company and products do toward delivering tangible value to your customers.  Every customer should rave about your company and products; word will spread to get you the market adoption you need to succeed financially.

Point Predictive

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