LONDON — Experian has launched a new lending tool that uses Open Banking and enhanced affordability data to give consumers greater certainty that they will actually receive a loan or credit card offer for which they have been pre-approved.
The credit reporting company said its new Fast Track service is designed to move more affordability, income and identity verification checks to an earlier point in the application process, reducing the likelihood that consumers will be declined or receive different terms after initially being told they were pre-approved.
Experian said consumers previously could receive a pre-approved offer through a credit marketplace but still face additional affordability and verification checks after entering a lender’s application process. Those checks could result in a rejection, revised terms, requests for additional documents or longer processing times.
Broader Range of Analysis
Fast Track analyzes a broader range of income, affordability and identity information earlier in the process, including Open Banking data, according to Experian. The company said the additional information allows lenders to complete more verification and affordability checks before presenting an offer.
For consumers, Experian said the system is intended to provide greater confidence that a pre-approved offer will ultimately be honored while reducing additional checks and unexpected changes in loan terms.
Experian said lenders could benefit by reducing manual reviews and applications that are unlikely to receive final approval while increasing the percentage of applicants who complete the process.
50% Reduction in Verification Issues Cited
Lendable, an early adopter and partner in developing Fast Track, has introduced the technology for its loan customers.
During testing, Lendable recorded a 50% reduction in verification issues among applicants who had been told they were pre-approved but subsequently encountered problems during final checks, according to Experian. The company said other lenders are also using Fast Track.
“Consumers want greater certainty when they search for credit, and lenders want to spend less time processing applications which don’t end up being approved,” said Edu Castro, managing director of Experian Consumer Services UK and Ireland.
‘More Relevant Offers’
Castro said combining traditional credit eligibility assessments with more extensive affordability and Open Banking information can help lenders present consumers with more relevant offers while simplifying the application process and improving conversion rates.
Chris Meurice, managing director at Lendable, said the company has worked with Experian since 2018 on pre-approved offers but believed additional improvements were needed to reduce the possibility of applicants being rejected late in the process.
“Fast Track is the missing link,” Meurice said. “It brings a new level of confidence for consumers, using the latest advancements in credit technology to remove last-minute rejections and ensure people pay only what they expect.”
