Murray Smith, president and chief executive officer of Affinity, said the company's initial business model revolved around manufacturing and selling automated lending kiosks. Sales of the terminals were brisk until banks discovered they could not drum up enough new business to justify their purchase.
It did not succeed as a business for customers that bought those
machines, Mr. Smith said.
Affinity still supports 10 banks that operate the automated lending machines, but it is no longer actively selling the product. It has refocused its business to support bank-lending operations at its data center in Columbia.
We took the technology that was behind the kiosks and used it to build highly automated loan processing systems that work through a bank's normal operations, Mr. Smith said.
Affinity's iDeal service, aimed at the $400-billion-a-year automobile lending market, pulls consumer credit reports and car information, then applies banks' lending policies to render decisions. Companies using the service include Dime Savings Bank of New York and People's Bank of California.
Affinity is also developing a product called rtDS (for real-time
decision service), which would exploit Affinity's patented technology. The service would enable credit institutions to automate loan processing on the Internet.
I think it is pretty obvious to anyone that the future is the
Internet, Mr. Smith said. It is the way loans will be done.
Affinity reported second-quarter revenues of $1.2 million, up 87% from a year earlier. It had a net loss of $2.5 million, down from $4.5 million.
Affinity still has $6.3 million left from the $60 million it raised in 1996, plus $1.4 million in outstanding receivables, which should keep it adequately funded in the near term, Mr. Smith said.
I think we can make it as a business again, he said.
americanbanker.com
Copyright © 1999 American Banker, Inc. All Rights Reserved.
By STEVEN MARJANOVIC, Boost for Affinity: AMS Licenses Decision System. Vol. 164, American Banker, 08-16-1999, pp 12.
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Posted: 08/15/1999 02:43 pm EDT as a reply to: Msg 3118 by mark1mod0
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