ClearScore has announced the launch of its new B2B Open Banking business.
The FinTech, which provides free credit scores and reporting, said that the new business would allow banks and credit card providers to speed up consumer bank data into mainstream lending.
ClearScore claims that its new business, which builds on its purchase of Money Dashboard in early 2022, provides the “most comprehensive set of Open Banking connections in the market” to 46 financial institutions.
The Open Banking service also includes what the company describes as an advanced transaction categorisation engine, designed to help financial services providers classify and analyse bank account transactions.
According to ClearScore, this categorisation system has been in development over the past 10 years, with over one billion transactions categorised during that time.
Through its new Open Banking services, the company said it has identified a set of financial behaviours– for example making deposits into a savings account–which means lenders can "split risk" or "more accurately" categorise the riskiness of borrowers.
“We believe that the future of lending decision making will be the combination of a range of data to make better decisions,” said Justin Basini, chief executive and co-founder of The ClearScore Group. “There is a huge opportunity for lenders to use open banking to enhance the underwriting process by identifying financial behaviour that materially splits risk within credit score bands and allows more accurate affordability assessments.”
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