Experian and Plaid link cashflow and credit data for lenders

The collaboration is intended to support lenders in accessing consumer-permissioned financial data, enabling more informed assessments of creditworthiness, particularly among consumers with limited credit histories. 

The joint offering combines Experian’s credit analytics with Plaid’s data connectivity technology. With consent from the consumer, financial information is retrieved directly from bank accounts. This data is compiled into a Consumer Report by Plaid’s consumer reporting agency and securely shared with Experian. Using this information, Experian generates either a Cashflow Score or a set of Cashflow Attributes, which are delivered to the lender in near real time.

Improving risk models with real-time data 

According to officials from Experian, the inclusion of real-time transaction data alongside traditional credit records is intended to improve the predictive accuracy of lending models. The Cashflow Score, which operates on a 300 to 850 scale, reportedly improves performance by up to 25% compared to conventional credit-only scores. Lenders can apply this score across various credit products, including personal loans, credit cards, and automotive financing. 

Plaid contributes data drawn from over 12,000 financial institutions, enriching more than 500 million transactions per day. The company uses machine learning techniques to categorise financial activity, tailoring insights specifically for lending applications. According to representatives from Plaid, the initiative aims to reduce barriers for lenders, particularly those aiming to serve borrowers outside the reach of traditional credit systems. 

Experian officials noted that by widening the view of an applicant’s financial health, lenders may be better positioned to manage risk and offer more accessible credit options, including for those with thin or non-traditional credit files. 

An industry analyst from Datos Insights observed that access to real-time cashflow data can both expand the lending market and improve risk management infrastructure. The Experian-Plaid collaboration, he added, offers scalable support for lenders seeking to reach underserved consumer segments.

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