Innovation spotlight: Using bank account data to improve access to credit

18 Oct 2019

Speaking at the Open Banking Expo event in Toronto on September 18, Dominique Samson, general counsel and chief of staff at Flinks, and Yassir Jiwan, digital innovation lead at Equifax, said their objective was to make it possible for consumers to gain access to financial services that previously weren’t accessible to them.

“We were looking for a partner that we could work with to stand up a well-controlled operating system that operates under strict protocols to provide deposit insights in a way that protects consumer data and mitigates some of the liability issues with regards to sharing those insights,” Mr Jiwan said.

“In Canada there’s a pressing need for deposit insights,” he said. “The existing methods in which credit is accessed doesn’t really work for some of the young adults that are coming through, as well as new immigrants that we are counting on to drive out future economic growth.”

The partnership between Flinks and Equifax aims to solve the problem of providing credit products to people who have limited credit histories but still need loans, payment cards and other services.

Mr Samson said the solution that Finks and Equifax have developed can prevent situations where young people with no credit history find they are being denied credit.

He said that, rather than look entirely at someone’s credit report, the new solution provides the option of looking into the applicant’s bank account data with their consent and continuing with the process.

“There’s a real technical prowess in transforming the data into useful attributes,” Mr Samson said. “Things like the number of non-sufficient funds, minimum balance, maximum balance and age of account. Once these attributes are produced, Flinks will pass them on to Equifax, their engine will run decisions based on these attributes and then will pass on the decision to the financial institution.”

Mr Samson added that this solution was designed from the ground up with consumer protection in mind and does not store and log information or sensitive data.

Mr Jiwan said the ambition from the start was to provide consumers with an option that was not available in the past and does not share unnecessary data with other parties.

“The fact is that you have almost 4 million Canadians that are already connecting their bank accounts just to get access to services,” Mr Jiwan said. “So there really is a need for another way.”