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Upstart’s Paul Gu: ‘AI is a mindboggling change in the economics of lending’

  • Upstart's lending models have been shown to expand access to capital without taking on more risk.
  • The fintech firm is rolling out a new auto product in addition to a credit decisioning API.
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Upstart’s Paul Gu: ‘AI is a mindboggling change in the economics of lending’

Artificial intelligence in finance has long been overhyped, but AI is making an impact in lending decisions. Online lender Upstart exemplifies how the set of technologies can expand lenders’ inclusiveness without necessarily taking on any more risk.

Paul Gu, a co-founder at Upstart, joins us on the podcast to talk about his firm’s new AI-powered credit decisioning API that is letting banks and other lenders deliver instant credit decisions for auto, personal, and student loans. We discuss Upstart’s performance during COVID as well.

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The following excerpts were edited for clarity.

The evolution of AI

To be honest, we have had the tailwinds behind us. There has been a rapid pace of innovation in AI and ML technologies over the past decade. Some of that is frankly powered by basic innovations in the amount of compute that’s available. It’s getting more cheaply and easily available through cloud technologies. Some of the mathematical work that underpins AI has also been advancing. We’re big consumers of academic literature that demonstrates new ways to do things. It’s a great time for us to be in this.


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