Consumer Portfolio Services Deploys AI-Powered Servicing Platform from Salient to Advance Collections Strategy

Rhea-AI Summary

Consumer Portfolio Services (NASDAQ: CPSS) has announced the implementation of an AI-powered servicing and collections platform developed with Salient. The platform utilizes conversational AI voice agents to automate key servicing functions including payment collection, due date adjustments, payoff management, and insurance verification. Based on previous implementations, Salient's platform has shown a 60% reduction in handle times and improved customer response rates. CPS reported strong performance with a 52% year-over-year increase in Q4 2024 auto loan originations and a record portfolio balance of $3.6 billion. The AI integration aims to enhance collections efficiency, improve repayment consistency, and strengthen cash flow while maintaining regulatory compliance with FDCPA, FCRA, UDAAP, and CFPB guidelines.

Positive

• 60% reduction in handle times and improved customer response rates expected from AI implementation
• 52% year-over-year growth in auto loan originations for Q4 2024
• Record portfolio balance of $3.6 billion
• Potential reduction in servicing costs through AI automation
• Enhanced regulatory compliance through automated systems

Negative

• Significant investment required in AI technology implementation
• Potential operational risks during transition to new AI platform
• Dependency on third-party technology provider (Salient) for critical operations

Insights

Financial Technology Analyst

CPS's AI servicing platform deployment should enhance collections efficiency and portfolio profitability while supporting continued loan growth with controlled operational costs.

Consumer Portfolio Services' implementation of Salient's AI-powered servicing platform represents a strategic technological advancement directly targeting the company's $3.6 billion auto loan portfolio. The timing is particularly relevant given CPS's recent 52% year-over-year growth in originations, creating a need for more scalable servicing operations.

The platform's automation of routine borrower interactions - including payment collection, due date adjustments, and insurance verification - addresses a traditionally labor-intensive aspect of auto lending. With Salient's technology having demonstrated a 60% reduction in handle times in previous implementations, CPS stands to realize substantial operational efficiencies across its servicing operations.

This deployment creates a dual-track servicing approach: AI handling high-volume routine interactions while human agents focus on complex cases requiring judgment and negotiation. The emphasis on maintaining regulatory compliance with FDCPA, FCRA, and CFPB guidelines addresses a critical requirement for automation in financial services.

The financial implications are multifaceted. By improving collection efficiency and repayment consistency, CPS may see enhanced cash flow timing and potentially improved credit performance. The ability to scale servicing operations without proportional staff increases creates operational leverage - particularly valuable for a company experiencing rapid portfolio growth.

This implementation positions CPS at the forefront of servicing technology in auto lending, where the ability to efficiently manage collections across diverse borrower segments often distinguishes performance. The emphasis on using AI for borrower engagement represents an evolution beyond simply using technology for internal processes, extending automation to customer-facing interactions where efficiency gains can directly impact portfolio performance.

LAS VEGAS, NV, May 08, 2025 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”), a leader in providing indirect automobile financing to consumers, today announced the deployment of a next-generation AI-powered servicing and collections platform developed in partnership with Salient, a leading provider of AI voice agent solutions tailored for the automotive industry.

As Consumer Portfolio Services continues to scale its loan portfolio and optimize servicing operations, Salient’s AI platform is expected to play a key role in accelerating collections and improving repayment consistency, which should improve credit performance over time. The platform leverages conversational AI voice agents to automate borrower outreach across key servicing functions, including payment collection, due date adjustments, payoff management, and insurance verification, allowing CPS to redeploy human agents to focus on more complex cases. Salient’s platform has demonstrated a more than 60% reduction in handle times and improved customer response rates in previous implementations, positioning CPS to benefit from similar efficiency gains as it integrates the technology in 2025.

“Our progress in scaling efficiently is supported by strategic investments in advanced AI automation,” said Mike Lavin, Chief Operating Officer of CPS. “By leveraging Salient’s voice AI agents to handle routine servicing tasks, we can free up our human agents to focus on higher-value and more complex customer interactions, strengthening our overall servicing and collections strategy. Salient’s technology enables us to execute collections strategies with greater precision and speed, improving repayment consistency, which should strengthen cash flow and credit performance over time. As we continue to expand our portfolio and originations, this integration reinforces the strength of our servicing platform while ensuring strict regulatory compliance.”

Salient’s AI platform has processed over $1 billion in transactions and is built specifically for the automotive lending industry. The platform ensures compliance with key lending regulations, including FDCPA, FCRA, UDAAP, and CFPB guidelines, while maximizing customer outreach effectiveness. By automating outreach and borrower interactions, the platform enhances customer responsiveness and regulatory adherence.

CPS recently reported strong loan origination growth, with a 52% year-over-year increase in new auto loan originations for the fourth quarter of 2024 and a total portfolio balance reaching a company record $3.6 billion. As CPS enters 2025 with momentum, leveraging AI-driven servicing solutions is expected to support continued efficiency gains and may contribute to further improvements in loan performance, reductions in servicing costs, and enhancements in overall portfolio profitability.

About Consumer Portfolio Services:
Consumer Portfolio Services, Inc. is an independent specialty finance company that provides indirect automobile financing to individuals with past credit problems or limited credit histories. We purchase retail installment sales contracts primarily from franchised automobile dealerships secured by late model used vehicles and, to a lesser extent, new vehicles. We fund these contract purchases on a long-term basis primarily through the securitization markets and service the contracts over their lives.

About Salient
Designed specifically for the consumer finance sector, Salient is a cutting-edge generative AI platform crafted to revolutionize customer-lender interactions. With its innovative technology solutions, Salient seamlessly automates vital operational processes across voice, text, and email channels, delivering a more streamlined and efficient communication experience for clients. Launched in 2023, Salient has interacted millions of US consumer, collected over $1 billion, and is backed by top tier venture capital firms, including Andreessen Horowitz, Y Combinator, Matrix Partners, and General Catalyst, alongside leaders from Tesla, Stripe, and Airtable. This platform promises to set new standards in the way automotive finance is approached and managed.

Company Contact
Danny Bharwani
Chief Financial Officer
949-753-6811

Investor Relations Contact
Tom Colton and Alec Wilson
Gateway Group, Inc.
949-574-3860
CPSS@gateway-grp.com

FAQ

What is the expected impact of CPSS's new AI platform on its operations?

The AI platform is expected to reduce handle times by 60%, improve customer response rates, enhance collections efficiency, and allow human agents to focus on complex cases while maintaining regulatory compliance.

What was Consumer Portfolio Services' loan portfolio size in Q4 2024?

CPS reported a record total portfolio balance of $3.6 billion, with a 52% year-over-year increase in new auto loan originations for Q4 2024.

What regulatory compliance standards does CPSS's new AI platform address?

The AI platform ensures compliance with FDCPA, FCRA, UDAAP, and CFPB guidelines while maximizing customer outreach effectiveness.

How much has Salient's AI platform processed in transactions?

Salient's AI platform has processed over $1 billion in transactions and is specifically built for the automotive lending industry.

What services will CPSS's new AI platform automate?

The platform will automate payment collection, due date adjustments, payoff management, and insurance verification through conversational AI voice agents.