Affinity Technology Group is expected to announce this week an agreement that will make its automated lending technology more accessible to community banks.
The Columbia, S.C.-based company reportedly has licensed its automated decision software to a new company, Talegis, that intends to sell loan decision processing services to community banks.
Affinity's software processes loan application data and delivers credit decisions in a matter of minutes-without any human intervention.
One application for the system is lending through ATM-like terminals, and Talegis is committed to selling community banks on the benefits of such machines.
"With an ATM as a cash machine and a loan machine, you've got a pretty good start on a branch," said Bruce Bugbee, chairman of Talegis, which is based in Reston, Va. "They are so much cheaper-and if they don't work out, you move them somewhere else."
Talegis plans to sell the automated lending technology through a consortium of bankers' banks that is now being formed. The consortium would help member banks acquire lending machines and would provide connections to Talegis for processing.
Under terms of the agreement-set to be announced at the Independent Bankers Association of America conference in Phoenix-Talegis owns the exclusive rights to resell Affinity's technology to the 6,000 institutions in the bankers' bank system, Talegis executives said.
Affinity executives declined to discuss the agreement before its official announcement.
Talegis is working with Community Bankers' Bank of Richmond, Va., to develop a prototype system based on Affinity's software. It expects the system to be operational within three months.
Though many financial institutions have expressed interest in installing ALMs, only a handful are actually using them, and only a few hundred terminals have been deployed.
Going through Talegis, community banks could get the ALMs up and running for as little as $30,000 a year, Talegis executives said. By contrast, setting up a direct connection to Affinity's system can cost as much as $100,000, they said.