U.K. lenders have a new way to use account aggregation technology: to help underwrite a borrower more efficiently.
LendProtect UK Ltd. announced Tuesday a partnership with Yodlee Interactive to create a new service designed to offer U.K. lenders a 90-day view of their prospective customers' bank account data, including deposits and payments.
LendProtect, a unit of FactorTrust, sells underbanked consumer data, analytics and risk scoring products to alternative lenders. The company plans to also offer the new standalone service, called BankLogic, to American lenders.
Lenders typically ask potential borrowers to provide their most recent bank statements when underwriting their loans. The new service is meant to quicken the process for clients that underwrite in minutes and hours versus days and weeks, says Greg Rable, chairman and chief executive of FactorTrust.
BankLogic will let lenders ask prospective borrowers to provide read-only access to account credentials through an online interface. The limited account access is meant to let lenders help complete identity verification, risk underwriting and affordability assessments. The consumer will get an email request to visit a secure site that asks for "what amounts to limited credentials," says Rable. "The consumer has to provide it and allow the lender to use it."
The bank account aggregation ability comes from the company's integration with Yodlee Interactive, which provides the data.
Underbanked customers will usually have a banking relationship in the form of a checking account, but lack traditional credit options, says Rable.
Should any inaccuracy occur within the consumer's data, Rable says the workaround would mirror what happens when standard underwriting manual fixes occur: the customer would sort out the mistake with the companies involved.
BankLogic will also launch to the Canadian market.
More than 600 companies globally use Yodlee Interactive services.