Credit Accelerator Harnesses Alternative Data
to Enable More Inclusive Credit Decisions
BERWYN,
Pa., Oct. 20, 2023 /PRNewswire/ -- Envestnet |
Yodlee is proud to unveil Credit Accelerator, a lending data
solution that promotes financial inclusion by harnessing
alternative data to expand access to credit for individuals who may
have limited or no traditional credit history.
The launch of this solution comes on the heels of the Consumer
Financial Protection Bureau's newly proposed rule implementing
Section 1033 of the Dodd-Frank Act which creates a consumer-centric
open banking framework in the United
States. This new framework provides opportunities for
businesses and consumers to realize new opportunities in credit and
lending. As highlighted in the CFPB 1033 NPRM, when consumers are
able to share their personal financial data, they can share details
about their income and expenses that may give lenders more
confidence when extending credit.
The macro-economic instability brought about by recent global
crises has made reliance on traditional credit scores a riskier
proposition than ever before. An overwhelming majority of lenders
now recognize that conventional credit data and scores often fail
to provide a comprehensive assessment of a consumer's
creditworthiness. In response, 59% of lenders have turned to
alternative data in their underwriting processes, recognizing the
need for a more holistic approach to assessing credit risk.
Envestnet | Yodlee's Credit Accelerator empowers lenders to
serve a wider range of consumers by leveraging a comprehensive set
of alternative data sources, including cash flow, income deposits
and asset information. This innovative solution draws from a global
network of 17,000 data sources, providing up-to-date financial data
and up to 24 months of statement data for various financial
accounts, such as checking, savings, investments, credit cards, and
loans. This additional insight into a borrower's financial
behaviors and decision-making gives lenders a more complete and
accurate view of an applicant's responsibility and willingness to
meet their financial obligations.
In today's dynamic financial landscape, consumers often undergo
significant life events that may not be immediately reflected in
their traditional credit data. This underscores the importance of
leveraging multiple data assets to assess creditworthiness
accurately, ensuring a deeper understanding of an individual's
financial profile.
"Delivering financial inclusion hinges on the utilization of
alternative lending data, as nearly 50 million Americans are credit
invisible and cannot obtain mortgages, credit cards or other
lending products," said Farouk
Ferchichi, President at Envestnet | Yodlee. "Many of these
individuals consistently pay rent, utilities and other recurring
financial obligations, demonstrating financial responsibility and
reliability. With an open banking framework in place, Envestnet's
Credit Accelerator can help bridge this gap and empower everyone to
live an Intelligent Financial Life™ by providing a more accurate
and comprehensive assessment of creditworthiness."
A robust tool that enhances traditional credit assessment for
lenders, Credit Accelerator provides transaction-level data on
assets, investments, and balances, enhanced by data science-driven
transaction descriptions. By leveraging Envestnet | Yodlee's
award-winning Transaction Data Enrichment, enriched transaction
attributes provide a clearer view of a consumer's overall financial
picture.
Attendees at this year's Money 20/20 conference in Las Vegas, NV from October 22 – 25 can learn more about Credit
Accelerator by visiting the Envestnet | Yodlee Booth in Money Hall,
#14327.
In addition, Lisa Novier, Head of
Governance, Risk & Compliance for Envestnet | Yodlee will share
insights on open banking and the CFPB's proposed 1033 rule during a
live recording at the conference, The MoneyPot: Move Over Europe,
North America's the New Open
Banking Champ!
Envestnet | Yodlee, with its industry-leading footprint, offers
digital solutions, open banking connectivity, data analytics and
differentiated experiences to its customers, delivered and embedded
through APIs and standalone portals. Its solutions empower
customers – including financial institutions in banking; technology
wealth management and financial advisors; small and medium-sized
businesses; and their end consumers – to intelligently
connect, grow, protect, and manage the financial wellness of
their business all in one place. The introduction of Credit
Accelerator reinforces the company's commitment to transforming the
lending landscape.
About Envestnet
Envestnet is transforming the way financial advice is delivered
through an ecosystem of technology, solutions and intelligence. By
establishing the connections between people's daily financial
decisions and long-term financial goals, Envestnet empowers them to
make better sense of their finances and live an Intelligent
Financial Life™. With more than $5.4T
in platform assets – more than 107,000 advisors, 16 of the 20
largest U.S. banks, 47 of the 50 largest wealth management and
brokerage firms, more than 500 of the largest RIAs, and
thousands of companies, depend on Envestnet technology and services
to help drive better outcomes for their businesses and for their
clients.
Envestnet refers to the family of operating subsidiaries of the
public holding company, Envestnet, Inc. (NYSE: ENV). For more
information, please visit www.envestnet.com, and follow us on
LinkedIn and X (@ENVintel).
Envestnet | Yodlee does not offer any loan products or make any
lending decisions.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/as-cfpb-announces-proposed-rulemaking-for-us-open-banking-framework-envestnet--yodlee-expands-access-to-credit-with-its-newest-technology-solution-credit-accelerator-301963502.html
SOURCE Yodlee Inc.