Finclusion introduces AI-driven affordability checks at loan origination

Finclusion has unveiled a new approach to responsible lending by embedding upfront affordability assessments into the very start of its customer journey, as scrutiny across the motor finance sector continues to intensify.

The lender has partnered with Inicio AI to deploy its virtual agent, Budgie, which guides customers through a detailed affordability assessment using conversational AI. The system is designed to create a clearer and more transparent understanding of a customer’s financial position before any lending decision is made.

Traditionally, motor finance affordability checks have relied heavily on credit scores and indirect data. Finclusion’s model marks a shift towards a more proactive and personalised process, using structured, explainable conversations to assess income, expenditure, and financial resilience.

“As a new lender, we have the opportunity to design our customer journey around responsible lending from day one,” he said. “Partnering with Inicio AI allows us to embed affordability at the very start of that journey, ensuring we build a clear and transparent understanding of each customer’s financial position. This is fundamental to our commitment to delivering sustainable outcomes and building long-term trust with our customers.”

While Inicio AI’s technology has previously been used to support customers in financial difficulty, this partnership represents a move towards using conversational affordability tools earlier in the lending lifecycle, before agreements are approved.

Rachel Curtis, CEO of Inicio AI, said: “This represents an important shift in how affordability is approached within motor finance, moving from a reactive exercise to a proactive foundation.”

The collaboration comes at a time when regulators and industry stakeholders are placing increasing emphasis on affordability assessments and customer outcomes. By integrating these checks into its origination process, Finclusion is aligning its operations with evolving expectations around transparency and responsible lending.

The initiative has also received backing from investors, including Future Planet Capital Regional. Rupert Lyle, Fund Principal of the West Midlands Co-Investment Fund, said the partnership demonstrates how technology can raise standards across the sector.

“As scrutiny around affordability continues to grow, approaches like this – combining transparency, technology and intent – have the potential to set a higher standard for the sector,” he said.