The Company’s program (“CCH Program”) combines two overarching functions with numerous interrelated benefits to the credit unions and their members:
1. Proprietary behavior-based underwriting enables extension of credit to qualified members including the underserved, non-prime market.
2. E-commerce shopping platform provides competitively-priced products and interest-free loans to purchasers, while simultaneously supplying increased Loans Out and Fee (instead of interest) Income to credit unions.
The underwriting component is based on borrower history and behaviors rather than credit score, as is standard in the lending industry. The shopping platform provides access to furniture, appliances, and electronics at market prices, but also incorporates a retail installment contract between the purchaser and the credit union which is electronically signed at checkout. The underlying loan is interest-free to the purchaser as the credit union accepts fee income from the Program by way of a % split. Finally, the retail installment contract allows the credit union to pull the installment payments directly from the purchaser’s account via automated deductions rather than leaving repayment up to the purchaser.
The Credit Union gains a larger market of spenders able to spend, and the members gain an ability to spend without predatory pricing or interest. In addition, the scalability of this model enables the credit unions to reduce variable costs as loan volume grows, as well as handle large growth in loan volume with minimal addition to fixed-overhead.
The Company’s main asset is its unique, patent-pending, business model. There simply is no lending platform like it.