CULedger, FiscalHive To Change Loan Participation Process For Credit Unions Using Blockchain And AI

Blockchain, Innovation, News | November 22, 2019 By:

Credit union industry blockchain initiative CULedger has teamed with artificial intelligence (AI)-based platform provider FiscalHive to streamline and enhance the loan participation process for credit unions.

CULedger, a Credit Union Service Organization (CUSO) comprised of more than 30 credit unions and other industry organizations, focuses on delivering innovative applications to credit unions through its cross-border global distributed ledger platform. CULedger’s MyCUID credential allows credit unions to easily identify members when they login, walk-in or call-in to their credit union, eliminating the need for multiple login credentials.

FiscalHive is an AI-based financial technology platform designed to accelerate transactions. Their mission is to establish a loan participation market that eliminates friction in this process, reduces broker costs and provides analytical insights for CU Chief Financial Officer’s to put them in control of Balance Sheet and Yield Optimization. The platform includes an end-to-end participation transaction workflow for both buyers and sellers. This built-in, efficient process can help reduce loan participation transactions to less than one week from the current 4-6 weeks.

In a press release, CULedger said that credit unions want to buy and sell loans from one another through a loan participation process, where one or more eligible credit unions share the risk associated with the loan by purchasing a portion of the loan from the originating credit union, adding that as with all loans, proper and thorough due diligence is critical.

“Loan participations are extensively used by credit unions, primarily in member business loans and consumer mortgage loans,” said John Ainsworth, CULedger CEO. “The long-term benefit of this partnership with FiscalHive will allow credit unions to provide complete visibility of all loan data for buyers and sellers and automate the due diligence process through CULedger’s trusted permissioned distributed ledger network of digital exchange.”

CULedger is working closely with FiscalHive to develop a proof of concept that will be made available for credit unions to pilot in 2020.

“Using the FiscalHive portfolio analysis tool, credit unions with excess liquidity will be able to create tailored loan portfolios,” said Sameer Sonalkar of FiscalHive. “By integrating MyCUID into FiscalHive’s AI platform, buyers of the loans will receive key information about the loans they participate in without the seller releasing competitively valuable information. In addition, digital signing, using MyCUID, provides higher levels of security and compliance.”