Adaptive Credit Extension Platform for Dynamic Checkout Financing
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Solution Overview
Problem
The financial industry's rigid workflow at checkout limits customer flexibility in selecting financing options, leading to potential missed sales and dissatisfaction, as customers are often presented with predetermined financing choices early in the transaction process without full consideration of final costs.
Innovation Solution
An adaptive credit extension platform that uses configurable processing circuitry to evaluate user and transaction information using multiple credit decision models, allowing customers to choose between financing options at checkout, including split pay and installment loans, and providing tailored credit offers based on real-time data and machine learning analysis.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If a single predetermined financing workflow is selected at the start of the transaction, then the workflow complexity is reduced and processing is streamlined, but customer flexibility and ability to make informed financing decisions at checkout are limited
Solution Approach 1:
The system implements dynamic workflow adaptation by allowing the financing workflow to change based on customer actions. Instead of a static predetermined workflow, the system can switch between different financing options and workflows during the transaction process, particularly at checkout where the customer has the fullest picture of costs. This enables the system to adapt to customer preferences and qualifications in real-time.
Solution Approach 2:
The system changes the parameter of workflow selection timing from early in the transaction to at checkout. By delaying the financing option selection until the customer has reviewed all costs and has the fullest picture of the transaction, the system allows parameter changes in customer understanding and preferences to inform the financing decision, thereby improving adaptability without significantly increasing complexity.
2Loss of time
If financing options are presented early in the transaction process, then the workflow is simplified and processing time is reduced, but customers cannot make informed decisions as they lack full picture of final costs
Solution Approach 1:
The system performs preliminary credit checks and financing option evaluations early in the transaction process, but holds the presentation of specific financing options until checkout. This allows the system to prepare financing options in advance (preliminary action) while delaying the customer-facing presentation until the customer has full cost information, thus resolving the contradiction between early processing and informed decision-making.
3Adaptability or versatility
If multiple credit decision models are employed to evaluate different financing options at checkout, then customer flexibility and access to credit are improved, but system complexity increases
Solution Approach 1:
The system segments the credit decision process into multiple independent credit decision models, each specialized for evaluating different types of financing options (e.g., installment loans, buy now pay later). This segmentation allows each model to focus on specific financing products, improving evaluation accuracy and customer access to appropriate options while managing complexity through modular design where each segment can be developed and maintained independently.
Data Source
AI summary
A method for employing adaptive credit decisions in relation to extension of a loan to a user may include receiving user information associated with the user and transaction information associated with a transaction of the user with respect to a product or service offered by a vendor, employing a first credit decision model to execute a first credit extension decision with respect to a first type of financing option based on the user information and the transaction information, employing a second credit decision model to execute a second credit extension decision with respect to a second type of financing option based on the user information and the transaction information, and determining, based on the first and second credit extension decisions, whether to extend a credit offer to the user when the user proceeds to checkout for the transaction.