This creates a single metric that interprets a customer’s eligibility based on both credit and transactional data.
The Fusion Score can unlock better rates or a smoother journey for those with established credit histories. For those with lower credit scores or thin credit files the inclusion of their transaction data, via open banking, can help identify and secure a reasonably priced product which ultimately improves their financial health. This is also the case for those that due to circumstances, such as a divorce, find it difficult to obtain credit as the current systems regularly exclude them.
The Competition and Markets Authority (CMA) published a report in 2016 on the UK’s retail banking market which found that older, larger banks do not have to compete hard enough for customers’ business, and smaller and newer lenders find it difficult to grow and access the market. They proposed open banking to solve this, a system where customers and SME businesses could share their current account information securely with other third party providers from January 2018.
Freedom Finance has partnered with UK-based fintech AccountScore to develop the new product.
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