Experian: Cashflow Attributes for Fair Credit
Business services company, credit score provider and FinTech Magazine Top 10 consulting firm, Experian, has launched Cashflow Attributes, its new open banking solution to help expand fair and affordable access to credit – particularly for thin-file and/or credit-invisible consumers.
Powered by 900 income, cashflow and affordability attributes, Cashflow Attributes offers cashflow insights and enables lenders to seamlessly integrate banking data into their decision-making.
Experian: Solutions to boost financial inclusion
While consumer credit reports are the most effective means to assess lending risk – in the US alone, almost 106 million consumers are unable to secure credit at mainstream rates because they are credit invisible or unscoreable by conventional means.
With Cashflow Attributes, Experian is able to add an additional layer to traditional credit report data, creating a more detailed view of a consumer’s financial health and creditworthiness for lenders.
The ultimate aim, of course, is to provide more opportunities for consumers, which is a core pillar of Experian’s operating model as a credit bureau.
Below, Experian outlines why its new Cashflow Attributes solution is so important:
- Financial inclusion: 42% of adults lack a conventional credit score in a range that typically grants access to credit at standard rates. Cashflow Attributes, which leverages checking and savings account information, offers a more comprehensive view of an individual’s financial profile. Using traditional credit data with lender-obtained cashflow information may unlock opportunities for consumers who may not have qualified if a lender was using traditional credit data on its own.
- Enhanced predictive accuracy: While cashflow insights are predictive on their own, when viewed with traditional credit information from Experian and expanded Fair Credit Reporting Act data, Cashflow Attributes can boost predictive accuracy by up to 20% allowing lenders to drive revenue growth while mitigating risk.
- Consumer willingness: Experian’s research shows that 71% of consumers are willing to share their banking information if it increases their chances of credit approval.
The importance of Experian’s new solution is clear, but how exactly does it work?
