March 17, 2026 — Fintech startup Fuse has secured $25 million in Series A funding to deploy an artificial intelligence-native loan origination system (LOS) for U.S. credit unions. The investment round was led by Footwork, with participation from Primary Venture Partners, NextView Ventures, and Commerce Ventures.
Modernizing a Legacy Backbone
A loan origination system serves as the core operational software for lenders. It manages the entire loan lifecycle from application to underwriting and final disbursement. Industry data indicates these systems are critical yet often outdated.
Fuse co-founders Andres Klaric and Marc Escapa initially built an automotive lending startup. They pivoted after identifying a larger opportunity to modernize the LOS landscape with large language models.
“Traditional systems can take as long as a year to integrate and typically have multi-year, expensive contracts,” Klaric told TechCrunch. He explained that Fuse uses AI agents to help lenders process higher volumes, automate underwriting, and cut operational costs.
A $5 Million ‘Rescue Fund’ for Transition
Fuse has already signed over 100 customers. To accelerate adoption, the company is allocating $5 million for a transition program. The initiative offers the first 50 qualifying credit unions free access to the Fuse platform until their existing contracts with legacy vendors expire.
Klaric described this as a necessary step, not a marketing tactic. “Because legacy software costs are high, many credit unions cannot afford to break their current contracts to switch providers,” he said.
Nikhil Basu Trivedi, a co-founder and general partner at lead investor Footwork, backed the company due to the clear market need. “We know the credit unions are really hurting and want to adopt AI, but have no idea how to do it,” Basu Trivedi said.
He compared an LOS to an enterprise resource planning or customer relationship management system in its operational importance. Swapping one LOS for another has historically been a difficult, lengthy process.
Competitive Landscape and Mission
Fuse enters a market dominated by established players like publicly traded nCino and private-equity-owned MeridianLink. Other AI-focused startups, including Casca and Glide, are also developing modern LOS platforms.
Klaric framed the company’s mission around supporting community-focused financial institutions. “Credit unions and smaller financial institutions have everything required to win,” he said. “They have the local presence, the local focus, great member experience. The only thing they don’t really have is the right technology.”
Industry analysts note that credit unions, which number over 4,000 in the United States, serve a broad middle-class membership. Modernizing their core technology could improve service and efficiency.
What Comes Next
The new capital will fuel product development and market expansion. Fuse’s approach highlights a broader trend of AI integration into core financial infrastructure, moving beyond front-end applications.
Success will depend on the startup’s ability to deliver on its promise of a smoother, faster implementation than legacy systems. The competitive response from incumbent LOS providers and regulatory considerations for AI-driven underwriting will be key factors to watch.
For more information on loan origination system trends, see the National Credit Union Administration’s resources.
Updated insights and analysis added for better clarity.
This article was produced with AI assistance and reviewed by our editorial team for accuracy and quality.
