Finicity’s new integrated set of credit-decisioning services to digitally transform lending with accurate, real-time and consumer-permissioned data
Finicity, a leading provider of open banking solutions, today announced the rollout of Finicity Lend™ for credit-decisioning. Finicity Lend, an integrated solution set of open banking data services, provides banks, lenders and fintech developers access to tools that enable their borrowers to directly permission data and insights into lending decisioning processes.
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Finicity Lend addresses the need for more efficiency and accuracy, better risk management, real-time insights, and enhanced credit-decisioning by delivering consumer-permissioned financial data, automated and predictive analysis through powerful analytics, and expanded data sources.
Finicity Lend incorporates several new data services with existing data services, as well as new capabilities in the Finicity open banking platform to create a more expansive, integrated solution. This platform and Finicity’s leading APIs provide the foundation for transforming the credit-decisioning process.
“The growing impact of the COVID economic crisis and the potential impact on consumer credit confirms an issue that has existed for some time now — a need for a deep evaluation of the credit review process and how consumers can become empowered to get more benefit from their own financial data,” said Finicity CEO and Co-founder Steve Smith. “Our new Finicity Lend integrated solution set will complement the current credit rating system while leveraging the tremendous advantages of open banking to create an industry standard for assessing a borrower’s ability to manage a loan going forward. Real-time, permissioned data from multiple financial accounts is the lifeblood of our secure open banking platform, and empowers consumers to make better financial decisions, to mitigate risk for lenders and can increase overall financial inclusion.”
New Capabilities — Cash Flow Analytics, CRA Data Services and Payroll Data
Leveraging the Finicity open banking platform’s robust data intelligence layer, Finicity Lend provides a new alternative data service, Cash Flow, that analyzes financial account data delivering a broad set of cash flow attributes. This gives lenders more accurate insights into a small business or individual’s creditworthiness. The Cash Flow analytics service digitizes and automates the capture and delivery of data that previously required significant combinations of manual and automated processes to extract and analyze. The use of this alternative data is supported by the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Federal Deposit Insurance Corporation, National Credit Union Administration, and Office of the Comptroller of the Currency as referenced in their Interagency Statement.
Also new to Finicity Lend are transaction and statement data services that are delivered in accordance with FCRA compliance requirements, ensuring that Finicity’s consumer-permissioned data meets the legal requirements of the Fair Credit Reporting Act.
Finicity’s decision to position itself as a Consumer Reporting Agency also ensures consumers have the ability to review, dispute, and correct any inaccurate information. This offers the most consumer-centric and consumer-friendly approach to using aggregated data within the credit-decisioning process.
Building on its leadership position with financial institution coverage, Finicity has added ADP as the first of many new payroll data sources to its open banking platform. Providing a direct connection to the payroll provider further enhances its ability to verify consumer-permissioned income and employment details — critical to many lending use cases — with real-time, direct from the source data.
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Finicity Lend integrated solution set includes the following data services:
- Assets
- Income
- Employment
- Transaction data
- Statement data
- Cash Flow
- Scoring Attributes
Expanding the types of data used to determine creditworthiness addresses longstanding consumer concerns that have surfaced more recently because of the global pandemic and resulting economic crisis. According to a recent study by Finicity, 95% of consumers negatively impacted by the economic crisis said they are concerned about their ability to rebuild their credit or take out a loan following this financial situation. Additionally, 82% of consumers said they believe the current credit review process and criteria need to change to make it easier for responsible borrowers to prove their creditworthiness. A majority of consumers stated that they would be willing to share current income information, payment history for utilities and other services, as well as rent history to give lenders an accurate view of financial standing and ability to pay.
Finicity Lend will make the credit process faster and more efficient for lenders who offer all kinds of loans, including mortgage, auto, small business, personal and more. Today’s lending process is in the midst of a vast digital transformation, placing Finicity and its technology at the forefront of this big-data revolution and the broader adoption of open banking in the United States. In June, Finicity announced that it had agreed to be acquired by Mastercard, a move which strengthens Mastercard’s existing open banking platform that has existed in Europe since 2019.
Open banking gives people and businesses more control over and benefit from their own financial data. This includes determining how and where third parties — such as fintechs or other banks — can access that information to provide new services like money management programs or initiate payments on their behalf.
Finicity is a founding member of the Financial Data Exchange (FDX), an organization dedicated to establishing broader industry standards for open banking in North America. Smith currently serves as co-chair of FDX and played a key role in its creation. Finicity also has established relationships with a wide variety of service and application providers that allow individuals and organizations to better understand, manage and control financial processes — everything from budgeting, saving, and borrowing to transacting, investing, and lending.
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