Open Banking proving pivotal to pandemic lending
Initiative will continue to thrive post-pandemic
One year on from the official UK government lockdown, Emma Steeley of AccountScore and Dan Weaver at Equifax UK, laud the role of Open Banking in driving the credit market, and call for lenders to further embrace the rising tide of technological progress:
Emma Steeley, CEO of AccountScore, an Equifax company:
“Since the first UK lockdown last March, we’ve seen a 140%* surge in the adoption of Open Banking across the board. Facing an unprecedented challenge, commercial and consumer lenders have accelerated their digital transformation, embracing Open Banking. This is allowing credit providers to make more informed and timely decisions utilising real-time current account data, and ultimately helping thousands of businesses and individuals access billions of pounds of credit at a time of critical need.
“With income shocks, rising unemployment and personal debt forecasted as government support unwinds, the financial landscape for consumers and businesses remains uncertain. Open Banking will have a vital role to play in this volatile environment, not only in assessing true affordability at the point of credit application but in identifying when consumers are becoming more financially vulnerable and fast tracking tailored support to get to the right outcome.”
Dan Weaver, Open Banking Expert at Equifax UK:
“Lenders must harness this moment of transformative change, and not let inertia stifle innovation. Take mortgage applications for example, real-time digital access to bank account information can be used to support ID verification, and provide an enhanced view of credit risk. This process, through in-depth categorisation, can incorporate rental and other important payments to understand complex income cases and provide a more accurate view of affordability than the statistical survey averages typically used today. The mortgage market is extremely complex, but through wholesale collaboration with fintechs, brokers and lenders, Open Banking solutions can fully digitise applications - dramatically streamlining the process while making it safer, fairer, quicker and less susceptible to fraud.
“Faced by the pandemic, society has achieved near miraculous feats of ingenuity in embracing new technology and ways of working. As we mark a year since lockdown, we in financial services should be looking to speed up innovation, not slow it down. Given the right platform, Open Banking can greatly improve financial services, helping achieve a harmonious melding of smart automation with human interaction and intervention, while making feats such as ‘instant mortgages’ a future reality.”
*Refers to the percentage increase in AccountScore Open Banking customers in this period
At Equifax (NYSE: EFX), we believe knowledge drives progress. As a global data, analytics, and technology company, we play an essential role in the global economy by helping financial institutions, companies, employees, and government agencies make critical decisions with greater confidence. Our unique blend of differentiated data, analytics, and cloud technology drives insights to power decisions to move people forward. Headquartered in Atlanta and supported by more than 11,000 employees worldwide, Equifax operates or has investments in 25 countries in North America, Central and South America, Europe, and the Asia Pacific region.
Equifax Ltd is a credit reference agency and one of the Equifax group companies based in the UK. Equifax Ltd is authorised and regulated by the Financial Conduct Authority. For more information, visit Equifax.co.uk and follow the company’s news on LinkedIn.
AccountScore Limited, an Equifax company, is a highly innovative global data and analytics business that provides actionable insights and analytics on bank transaction data for clients. Providing reliable, accurate and easy to understand transaction data analytics on data either sourced through consents.online (AccountScore’s AISP) or directly imported. AccountScore’s subsidiary Consents Online Limited (consents.online) is a registered Account Information Service Provider (AISP), regulated by the FCA, which provides branded Open Banking as a Service (OBaaS®) and has access to APIs from banks to collect transaction data and provides the consumer with a portal to give them control over viewing and managing related data consents.