The average FICO credit score in the United States is currently at an all-time high of 695 but 32 percent of Americans have a credit score lower than 601, placing them into the broad lump that the Consumer Financial Protection Bureau defines as “subprime credit”.

These Americans that would typically be declined for a line of credit now have another option: Snap Finance.

Snap’s artificial intelligence system is able to analyze upwards of 650 data points, a number that is constantly growing, to look at alternative financial data patterns in order to provide a clear picture of the consumer’s creditworthiness at the point of sale in tire dealers, which is much clearer and more current than FICO scores.

“We’re not trying to compete with the big banks and the market with and the prime consumer demographic,” says Nate Story, one of the core creators of Snap’s AI system. “We’re trying to find those folks who have had life events and other blemishes on their credit report that have cut them out, by sourcing other alternative data outside of personal credit reports.”

Developed in 2014, Story said the AI system has been tweaked and improved over the years, and is currently used by over 10,000 retail partners across the country.

“What we realized over time was the types of lending algorithms or models that were being used to make lending decisions were very inflexible and increasingly antiquated and they didn’t quite keep up with the speed of the changing data landscape or the available technologies,” says Story. “So we realized the great opportunity about two and a half years ago to start migrating our lending platform to a very robust and dynamic artificial intelligence platform.”

The AI system is hosted on a web portal where applicants fill out a quick application, and in less than a second, the system checks with hundreds of different data points from second-tier credit reporting agencies to look at things like banking history and address history, and renders a decision in a couple of seconds to approve or deny the customer.

“We’ve increased the speed a process, where its a simple five-minute application and approval for the consumer,” says Ryan Slobodian, executive vice president. “So it’s great for the retailer as you can imagine. Your typical tire store, where there’s lots of people going in and out, the last thing they need is several hours of waiting for credit approval. Snap helps them get more customers in and out in a shorter period of time.”

The system’s learning capabilities allows it to adjust its algorithms multiple times a day to better make decisions and produce more approvals based on historical data.

“So if there are bad events that happen for a certain profile of consumer yesterday, the model will then consider those outputs either in the same day or the following day and then modify its decision, and based on that, have insight into a particular risk profile that maybe didn’t exist a week prior,” says Story.

Once customers are approved, Story says the full payment for the product is transferred to the retailer within 24 hours by Snap and the consumer then has a relationship with Snap from that point forward in the repayment process.

“We know that people are more than just a credit score,” says Slobodian. “We can look at more variables than just their physical store score. We’re able to get a better understanding of who they are. Maybe they do have a profile close to work but they’ve had their checking account for a long period of time and they’ve been making their rental payments for a long period time. There’s a lot of other things that go into making a holistic picture of that consumer that allows the AI engine to make a good decision.”

Story says that Snap provides customers who need tires with access to tires, and dealers a new customer base with the ability to close more sales, which benefits both parties.

“Retail is a very tough business and a lot of the smaller independent folks and the larger regional chains are fighting with the big box stores day in and day out to find ways to keep that customer within their store. Snap has a unique offering that allows them to keep those customers coming back to them over and over again,” says Slobodian.

With a recent redesign to the software, Story says the company is constantly working to improve the AI system given how ever-changing the tech and tire industry are. In the future, Story says that Snap is considering how to broaden Snap’s reach with POS systems.