The UK consumer lending market is worth £160bn, yet over 15 million people in the UK are denied access to affordable loans. These people are resorting to unsustainable means including high-cost lenders and buy-now-pay-later schemes to manage their lives. Today, digital consumer lender Fintern has launched to radically transform the financial well-being of people with an innovative and sustainable lending approach that goes beyond traditional credit scoring and puts affordability first.
Fintern’s next generation credit technology bypasses credit scores in making lending decisions, focusing instead on affordability. Fintern builds relationships with customers helping them to understand how much they really need, how much they can afford to take on, and how they will repay. Fintern integrates its AI platform with Open Banking1 to smartly connect the dots in consumers’ banking data enabling Fintern to obtain the most accurate view of borrowers’ affordability and spending behaviour using real time transaction information.
Gerald Chappell, CEO and co-founder of Fintern commented: "Fintern will help people to really understand what is affordable for them, rather than offering yet another faceless transactional process. Currently, lenders either lend money or don’t, and then don’t engage with the borrower again until the loan terms ends or payments are missed.
"Our success as a lender lies in the ability of our customers to repay their loans. Our AI-powered technology helps us and all our customers to understand their finances in a deeper, more hands-on way than ever before. This approach allows us to increase approval rates, lower APRs and empower our customers to make the best and most responsible borrowing decisions for them."
The approach of banks to personal lending inappropriately results in "computer says no" answers for millions every year. While traditional behavioural credit scoring (the industry’s approach for credit decisioning) works well to separate the highest quality customers from the lowest, it performs poorly in differentiating risk among the majority of people. Often the consumers hardest hit are those who have had historical blips in their credit records or, for example, those people who are new to credit or have moved countries.
Dr. Michelle He, COO and co-founder of Fintern added: "We will be closer to our customers than incumbent lenders can ever be, and this will differentiate us in the marketplace. Intelligently integrating AI and Open Banking data disrupts credit decisioning for the better of all customers. Doing it well requires the right experience. Data and technology are Fintern’s bread and butter. We have an amazing team with extensive experience in digital lending and credit analytics. They are customer obsessed and have made the Fintern App a unique experience."
Looking ahead, Gerald Chappell added: "As we emerge from the Covid-19 pandemic, Fintern is needed now more than ever. While many existing lenders are reducing credit supply given the shock to their existing portfolios, Fintern uses high frequency transaction data to understand consumers’ real time financial circumstances and lend responsibly. Over the next 4-5 years, we intend to rapidly grow in the UK building a £1bn loan book alongside broadening our product range and considering expansion to other geographies."
Fintern received its FCA authorisation as a regulated consumer credit lender in February 2021. The co-founders have built an exceptional team that includes credit experts with over 100 years’ experience in finance and technology.
