Beforepay Group launches Carrington Labs, a business line to commercialise its AI-powered risk models and lending platform

Beforepay Group launches Carrington Labs, a business line to commercialise its AI-powered risk models and lending platform

ASX-listed Beforepay Group have announced the launch of its business-to-business offering, which will make the company’s technology available to enterprises. This offering commercialises the company’s risk-management solutions, proprietary models, and lending platform.

The new business will trade under the name “Carrington Labs” and will offer enterprise clients the same technology and artificial-intelligence tools that power Beforepay’s ethical-lending products, and enables the company’s rapid growth, high levels of efficiency, and excellent lending outcomes.

Carrington Labs will offer two products. The first is a decision engine that brings together the Beforepay’s AI-powered risk-management modules, using alternative data to make quick, accurate lending decisions in a fully-automated, low-cost manner. This engine combines the following tools:

  • AI-powered paycycle detection and prediction – algorithms that use natural-language processing (NLP) and machine learning used to identify salary transactions and forecast income timing and amounts going forward, for income verification and repayment scheduling;
  • Data ingestion and pre-processing – a module to take in different types of alternative data, categorise transactions, and prepare the data for training and inference;
  • Advanced risk assessment – the centrepiece of this solution, our native AI risk-scoring model tests more than 50,000 individual variables to select the 400-500 most predictive variables that could impact a borrower’s financial stability and creditworthiness, including behavioural, financial, and other factors, using gradient-boosting algorithms;
  • Personalised limit-setting – an engine that automatically conducts programmatic A/B testing, randomising users into different cohorts with different limit journeys, to create data points which can then allow estimation of default elasticity. This enables the calculation of the value-maximising limit for each customer, based on likelihood of default at different potential limit sizes and the implications for expected customer lifetime value; and
  • Repayment scheduling and debiting – logic to combine the limit-setting outputs and the paycycle forecasting to create an individual, optimised schedule for customer repayments.

The second product from Carrington Labs will be an end-to-end loan origination and servicing platform, the next iteration of the highly automated, highly efficient lending platform that has enabled Beforepay to issue more than 4 million loans since inception. Beforepay’s current platform allows it to originate an average of 35,000 loans each week with a team of fewer than 40 employees and additional outsourced offshore customer-support staff.

This end-to-end solution will aim to support an entirely digital lending journey, expected to enable customers to go from account creation to funds received in as little as 5 minutes, done entirely through a smartphone app (or optional web interface). It will seek to combine origination, loan management, and an optional front-end experience in an integrated and efficient way.

Commenting on the launch of Carrington Labs, Jamie Twiss, CEO of Beforepay Group, said “I’m excited for our forthcoming launch of a new business line to provide our AI-powered risk models as well as our automated lending platform to partners, as well as new lending products.”