Lenders look to AI for infrastructure, efficiency

As AI usage grows across all industries, equipment lenders are looking to leverage it for their own purposes.

AI is already being used for productivity and risk management in the equipment finance space, Tamarack Technology President and Chief Technology Officer Scott Nelson told Equipment Finance News.

“You can pretty much assume that every big lender that has strong IT … is trying to figure out how AI is going to make them better or how it’s going to create a threat,” he said.

Lenders are looking at AI for mass data analysis and infrastructure optimization.

Increased productivity through automation

AI could allow lenders to collect data on their financed equipment faster and with a better picture of the market.

For Capital Farm Credit, which says it is the largest agriculture equipment lending cooperative in Texas, use of automation software Tractor Zoom Pro has streamlined the updating of evaluations and consolidating large amounts of data, Shaun Wied, relationship manager at the Bryan, Texas-based lender, told EFN.

“I would venture to say it was anywhere from a 30% to 50% reduction in time that it would normally take to complete that evaluation,” he said. “It’s really created some efficiencies for us, which in the lending world is key.”

Tractor Zoom Pro can track the age and condition of equipment in databases for every Capital Farm Credit operating loan. Combined with a mobile app, lenders can update their databases in real time as they inspect equipment.

Additionally, Tractor Zoom Pro’s online database compares national auction data and dealership listings to give market estimates for equipment based on model, condition and location, among other factors, Wied said.

“With equipment the way it is now, guys are looking everywhere,” he said. “If we’re going to finance this deal, we already have a pretty good idea of what those sales are.”

Capital Farm Credit may consider using Tractor Zoom’s geotagging and timestamping photos in the future to prevent inaccurate reports on equipment statuses, Wied said.

IT streamlining

Meanwhile, Grand Island, Neb.-based lender Amur Equipment Finance uses AI to manage its tech infrastructure, automate routine IT tasks and predict system failures before they happen, Jeremy Gillam, senior vice president and head of technology, told EFN.

“This integration of AI into DevOps [software methodology] not only facilitates continuous delivery and deployment but also significantly reduces the risk of human error, thereby improving overall system reliability,” Gillam said.

To process and classify documents, the lender also uses AI-driven machine learning programs to train it, and software that processes speech, he said.

However, humans will continue to have the final say on sensitive or critical decisions, Gillam said.

“Although these systems can improve efficiency, they often lack the nuanced understanding and empathy required in complex or sensitive situations,” he said.

Amur Equipment Finance ranked Monitor 100 Index, which tracks the scale of lenders by new business volume. Amur’s new business volume was $769.9 million, according to the index.

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