Data helps facilitate the process of lending, borrowing and saving

“”bank It’s no longer the place you go — that’s what you do. ” LendingClub Financial Health Officer Anuji Nayal I told PYMNTS in an interview.

And in the realm of banking services credit And lending, And technology-enabled companies may also improve the financial position of their customers.

Financial health may certainly be considered a timely subject. A joint study by PYMNTS and LendingClub found that 54% of US consumers had little or no money left after spending their money. That’s about 125 million adults.

These are not just low-income individuals and families who are tackling financial challenges. According to a survey, about 40% of Americans who earn more than $ 100,000 also struggle to pay their salaries. In above-average demographics, 12% struggle to pay.

“After all, money is probably the most important thing, other than caring for your family and managing your health,” Nayar said, regardless of income level.

Contrary to this embarrassing background of unpaid invoices, he says the lending industry can help consumers find better ways to get out of debt with the help of advanced technology. I did. Approximately half of Americans who have a credit card spin their credit card, which means they don’t pay every month.

“That is, basically, they have long-term, high-interest, and fairly bad personal loans,” says Nayar.

Along these lines, a typical FICO score does not really determine creditworthiness.

According to him, the FICO score is based on the assumption that it does not apply to many Americans today. This is due to an increasing number of borrowers who do not have the job of providing a fixed monthly salary each time.

Nor is it true that past performance, or payment history, guarantees future performance.

Nayar said that after the Great Recession, companies including LendingClub said he data Other alternatives for investigating a consumer’s financial position and designing a new product that meets their needs. “

Reducing reliance on banks in a physical branch environment and increasing the comfort of mobile banking in combination with these alternative data sources connect points and gaps in helping people get out of debt. Helps to fill.

Debt acquisition and avoidance

“One of the biggest things beyond getting out of debt is to build some financial health that allows you to get out of debt,” he said.

LendingClub collects 14 years of data from marketing to loan pricing and default rates, collecting about 140 billion cells of data in 2017 alone, marketing to loan performance.

That data is helping businesses move beyond just connecting borrowers and investors to a fully digital market for financial services. He noted that he recently acquired Radius Bank, a bank without an online branch, to move to checks, savings, and related services.

“We can create a model that helps consumers both on the rental side of the house and on the” opposite side “of the house,” he said. “There is a new model that combines the strengths of both FinTech and banking, whether you spend money or save money.”

According to a recent LendingClub survey, 83% of LendingClub members want to do more in the company, and the majority of users can also use their checking accounts to improve loan management. We may also use continuous underwriting in new ways to seamlessly blend credit and savings.

“The ultimate idea is a one-stop shop that helps relieve consumer pressure when trying to make sure consumers are making the right financial decisions using AI and in-depth analysis. It’s about creating a shop, “he told PYMNTS.


New PYMNTS data: Focus on AI: Banking Technology Roadmap

About research: AI In Focus: Bank Technology Roadmap is a research and interview-based report that explores how banks can use artificial intelligence and other advanced computing systems to improve credit risk management and other aspects of their operations. This playbook is based on a survey of 100 bank executives and is part of a larger series that assesses the potential of AI in the financial, healthcare and other sectors.

https://www./news/banking/2021/data-helps-de-stress-consumer-lending-borrow-savings-process/ Data helps facilitate the process of lending, borrowing and saving

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