Open Banking data provider Yolt has announced a collaboration with October, a European SME lending platform.

Due to go live in France, Italy, Spain, the Netherlands and Germany, the deal will see October using Yolt’s Account Information Services to utilise Open Banking data in its credit assessment process for SME lending.

The objective is to gain efficiency by replacing PDF-based bank statements with “up-to-date and real-time” Open Banking data.

“Through this collaboration, Yolt and October will demonstrate how Open Banking can play an increasingly vital role in providing greater financial inclusion for SMEs, while making the process much easier when it comes to applying for a loan,” said the partners.

Traditionally, credit companies rely solely on annual accounts and external credit bureau data to make credit decisions, leaving many suitable businesses without good credit options, as the information is outdated and does not give the full picture.

Yolt’s Open Banking data provides a broader profile of the loan applicant and potentially broadens the options for those businesses looking to access credit.

October’s customers will be able to “simply link” their bank accounts at the point of application, providing access to a broad profile of their businesses’ credit worthiness, the partners said.

Since 2016, October says it has been using non-standard data in the credit underwriting process, facilitating access to its client information “automatically, quickly and in real-time”, and in turn, increasing the accessibility of credit to many SMEs.

Yolt enables October to leverage Open Banking in its five countries of operation with a strong coverage of local banks.

Nicolas Weng Kan, chief executive of Yolt, said: “We’re confident this collaboration will help to improve the lending experience for SMEs, providing broader credit options quickly and accurately. This does not only make the credit application process faster and more transparent, but also fairer.

“With Open Banking, businesses have control of their own financial data, and it provides an easier way to verify income and demonstrate credit worthiness.”

Patrick de Nonneville, chief executive of October, added: “Yolt’s strong European coverage corresponds to October’s footprint and enables SMEs to link their bank accounts, so that we can assess a broader profile of credit worthiness and speed up our decision process.”

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