Empowering individuals with the ability to share their data can absolutely improve financial inclusion, especially fairer access to credit for vulnerable underserved communities. We talk a lot about thin-file or no-file credit history customers being brought into the fold by using transaction data to assess behavioural and affordability risk; we’ve seen considerable expansion in loan approval and credit worthiness for those who had previously been excluded once they were able to share their open banking data.
But what if one could share their employment data, or government benefits data, when assessing affordability? What if there were a bigger picture that shed a different light on whether or not a candidate were a default risk? Being able to share tax data or vulnerability characteristics can change a no to a yes for certain types of underserved or excluded groups. Open finance and open data are formalised frameworks that enable this type of safe, secure, and consent/permissioned intelligence exchange. Making a variety of alternative data mobile and sharible for those who don’t have a deep history of traditional financial data means a chance to actually GET more traditional financial products and services.
Open data can literally open up inclusion.
Ghela Boskovich
FDATA Region Director Europe