In the withering July heat of South Carolina, several sweat-soaked furniture movers questioned Jeff A. Norris' judgment.
Mr. Norris, president of Affinity Technology Group, decided to relocate the company headquarters in the midst of a heat wave.
"The timing of this thing could be better," said one worker, as he climbed down from the truck and headed for some shade in an alley off Columbia's Main Street.
Investors, too, may have some concerns about the move. Affinity, which has created a stir in retail banking circles with its automated loan terminals, has yet to turn a profit nearly three years after its launch and four months since it went public. So it may seem a bit willful to be forsaking a storefront for swankier quarters high in what Mr. Norris calls the tallest building in the state.
But he insists now is the time. Conceived while Mr. Norris, 35, was working on his Duke University graduate school thesis on retail banking, Affinity has more than 100 employees in the last year and a half, outgrowing its old location. It also happens that the new offices, vacated by AT&T in the midst of a downsizing, came cheap.
In addition, the scope of Affinity's business is growing, and the prospects for profitability look bright, according to analysts.
Known a year ago exclusively for its automated loan machines - ATM-like mechanisms that deliver consumer loan decisions as quickly as 10 minutes - Affinity now offers several types of credit services through a variety of delivery channels.
At the heart of these offerings lies the Decision Support System, which uses direct links to credit bureaus and other sources of consumer information to automate loan decisions.
"As popular as the (machine) has been, it is just one way to use the Decision Support System," said Mr. Norris. "We're moving quickly to add others."
Right now, because they address the banking industry's concern about delivery-system costs, the automated loan machines are what attract attention to the company. They appear to be an easy way to reduce loan- related expenses while attracting new business.
According to Andersen Consulting it costs $1,800 to $3,800 to process a loan originated at a branch. Automated loan terminals lower that to between $300 and $700.
Like automated teller machines, the loan terminals can be placed in remote locations. If a bank puts them in shopping malls or auto dealerships, they offer credit close to where it is needed and might attract people who might not otherwise have approached the bank.
"It is to the banks' advantage to take advantage of consumer familiarity with banking by ATM and phone and use those channels to sell high-margin products like loans," said James S. Greene, managing partner in Andersen's financial services strategy practice.
Andersen itself has developed an automated loan terminal. It is in use at a bank in the United Kingdom and is being tested by several U.S. banks, Mr. Greene said.
Affinity's terminals have one important difference from competitors': They print checks. Consumers approved for loans walk away with the proceeds in hand.
Mr. Greene said that according to Andersen's research, consumers don't place much value on that feature. But he quickly added that the concept of the automated loan machine is sound.
Do consumers agree? Several banks, including Banc One Corp., First Union Corp., NationsBank Corp., and Puerto Rico's Banponce Corp. are in the process of finding out.
They are among institutions that have ordered or installed the 200 to 300 loan machines sold by Affinity. Before committing fully, the banks are watching closely how consumers react to the idea of conducting highly personal financial transactions in public settings like malls.
"If we weren't seriously interested, we wouldn't be testing them," said Ellison Clary, a spokesman for NationsBank. "It's a situation where we want to see them perform before" adopting a more aggressive plan.
Union Planters Corp. of Memphis is trying the machines in a handful of automated branches. It also is using Affinity's Decision Support System to automate lending through other channels, including phones and branches.
Though the system's applications for these channels do not promise savings as great as those from the loan machines - loans over the phone require involvement by a bank employee, for example - all are cheaper than traditional loan methods, according to Union Planters officials.
Loans made using the system "won't have to be sent to centralized lending where a live person underwrites and approves it. That's where we expect we'll save money," said Luke Yancy, executive vice president at the $11 billion-asset company.
Mr. Norris said Affinity charges banks about $4.50 for transactions that do not result in a loan. When a loan is approved and taken by the customer, Affinity gets a percentage of the loan amount.
Mr. Yancy said Union Planters is offering a range of secured and unsecured loan products and has reduced decision time dramatically.
"If it's an unsecured loan, we can close it on the spot," Mr. Yancy said. "If it's an automobile loan then we do what we'd normally do, which is to tell the customer they can write the check to the dealer. Or if it's a mortgage product, the loan will be subject to appraisal."
In any case, a loan decision usually can be made in 10 to 20 minutes, he said.
Securities analysts have reacted positively to Affinity, precisely because all its eggs are not in the same basket.
Richard K. Weingarten, an analyst with Montgomery Securities in San Francisco, wrote in June, "Affinity is an applications company, not a device company."
Thomas K. Brown, an analyst at Donaldson, Lufkin & Jenrette Securities Corp, wrote in a July report: "Investors must understand that to properly estimate Affinity's growth potential, the focus should not be on the single aspect of the ALM, but rather the underlying technology of the Decision Support System."
Mr. Weingarten initiated coverage of Affinity, which is traded on Nasdaq, with a "buy" rating. Mr. Brown rated it "outperform." Its second- quarter loss of 4 cents a share was a penny less than expected.
Mr. Norris said he is pleased by the evaluations, but not surprised. "We address a need in banking that is obvious, and we're one of the first to do it," he said.
But as the company began settling into what Mr. Norris jokingly refers to as "Affinity Towers," he sounded a note of realism. "We were quick out of the gate," he said. "But now we've got to capitalize on that lead."