Credit underwriting software developer Zest AI has closed a $15m investment from Insight Partners.
The capital was raised to support the adoption of Zest’s Model Management System for creating and deploying powerful, explainable and compliant AI-powered credit models.
Zest AI also plans to use the funds to drive rigorous technology and standards around algorithmic fairness, with the aim of de-biasing the lending market.
Banks and credit unions can use Zest AI to improve their credit underwriting decision making. Its technology uses machine learning to go beyond traditional credit scores to assess whether consumers would be good borrowers.
Clients can integrate the technology to build their own models and meet compliance with various regulations.
The FinTech claims that, on average, its clients see a 20% increase in approval rates with no added risk and up to 50% reductions in charge-offs.
Insight Partners managing director Deven Parekh said, “The Zest team has deep domain expertise in both lending and explainable AI and this has led to strong product-market fit; however, what has really excited us is the opportunity to tilt the lending landscape toward equity and inclusion.
“It’s not every day you get to use proven technology to directly impact the economic opportunity gap in the U.S.” Insight MD Lonne Jaffe will be joining the Zest board with Jon Rosenbaum joining as a board observer. Other current Zest investors include Matrix Partners, Lightspeed Capital, and Upfront Ventures.
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