Team Fusion CreditSense (Philip Crisp, Alan Wynmclean, Chloe Luo, Ivy Yoo)
People and businesses can only gain credit today based on their borrowing history (also referred to as their credit portfolio). This has led to financial inequalities where individuals who haven’t borrowed before are now “locked out” of the lending process entirely.
Now, more than ever, in a world shaken by the Coronavirus individuals and particularly vulnerable groups who have never needed to borrow are finding themselves in financial hardship through no fault of their own. Because these people haven’t borrowed before, they’re left with nowhere to turn.
But why is this important?
· In 2019 only 0.59% of mortgages were given to customers without a robust credit portfolio.
· Customers who haven’t got credit in the past are now prevented from getting credit in the future because of this lack of a portfolio.
· Your financial credibility can decide whether you can buy a new car, get a mortgage on a house or even use an instalment plan for a new purchase.
· Financial invisibles are emerging who are unable to gain access to credit dur to this lack of a credit history and as such this results in a self-fulfilling cycle of credit restriction.
So how does our solution address these issues?
First, we’re hacking systemic inequalities by removing any potential unconscious bias from the credit decision. Individuals from areas of social or economic hardship that do practice positive banking trends regardless of background will be able to access credit using our system, potentially for the first time. This first step will help them build up a credit portfolio to allow them access to greater credit and opportunities provided by the system in the future.
These financial invisibles will no longer remain so. If they have a bank account, they will be able to provide access to lenders to the information necessary to decide “shall we lend to this person”.
Banks will be able to provide custom incentives / packages to their customers based on this information and in some cases may be able to offer micro-loans to their customers to help them build their portfolio.
In a world still struggling under the strain of COVID-19 and the economic pressures it’s levied, businesses will for the first time be able to leverage their history to help them secure their future. They can show a potential lender their accounts and banking trends and from this they will get access to much needed financial support during these difficult times.
Fusion CreditSense is built with modularity by design. Initially built with micro-loans to build a credit portfolio in mind, over time additional services will be added to enrich the offering and provide more tailored assistance to users of the product. This solution isn’t just tailored for businesses, but is also intended for individuals too.
To develop our solution, we combined Finastra’s OpenBanking API’s, FusionFabric.cloud’s rich catalogue of Loan Origination API’s and 2 custom machine learning models with our own custom API’s to establish a new measure of creditworthiness for an individual.
By analysing your banking history to identify positive banking trends users of Fusion CreditSense can reward their customers for banking responsibly by providing them access to a line of credit.
The Future of Finance is Open - The Future of Lending is Open