More lenders are accepting non-traditional credit data as part of their best practices. With nearly half the American population carrying a subprime credit score, rent-to-own companies, online installment, storefronts and others are embracing new tools to intelligently navigate a market that has been largely overlooked.
With an eye toward the future, Clarity Services developed a novel method to confirm a consumer’s banking status. The solution, Clear Bank Debit™, displays data from a consumer’s debit card that either confirms or contradicts their application information, something no other credit reporting agency is doing.
Cash Isn’t King Anymore
These days, cash is for the odd, rainy day occasion. Most of us know this anecdotally. How do the facts compare to the average consumer’s experience?
- Cash is only 14 percent of the share of transactions by value of payments (The Federal Reserve System Cash Product Office).
- While the average American spends roughly $100 per day – not counting the purchase of a home, motor vehicle or normal household bills (Gallop), half of us are walking around with less than $20 cash (Bankrate.com).
- If given the choice between a cashless and cash-only shop, most consumers in the wealthiest countries prefer the cashless option (ING Group/eZonomics).
- Nearly 40 percent of Americans said that they would be happy to go completely without cash.(ING Group/eZonomics).
Contextualizing an Applicant with Granular Info
The average credit applicant uses their debit card at least 21 times per month (2015 Debit Issuer Study commissioned by PULSE). In other words, insight into debit rails (and, by association, the bank account) yields reliable status details for an applicant’s financial circumstances. At a glance, you’ll get a summary description of an applicant’s debit card:
- Total number of debit cards
- Number of recently activated cards
- Amount of social security numbers associated with card
- Confirmation of primary account ownership status
Also provided are more exact details with reason codes, which will help lenders answer important questions like:
- Is the CVV a match?
- Is the ZIP code incorrect?
- Is the account associated with a high-risk bank?
- Is the account in good standing?
- What retail transactions took place in the last 24 hours?
Immediately, lenders can see if there’s anything on an application that is either false, incorrect or somehow inconsistent. These yes-or-no details get you much closer to confirming a high or low credit risk.
We Want to Help Your Likelihood of Repayment
While an applicant may have every intention to make good on a promise of repayment, the view provided by Clear Bank Debit™ helps lenders better understand risk. Clarity features a variety of mechanisms for lenders to distinguish the bad applicants from the good ones. Clear Bank Debit™ gives you both a general impression of what an applicant’s banking situation is like as well as the more specific details to refine your judgment. This is a handy tool for reliably better lending decisions to help increase your ROI.
Add the power of Clear Bank Debit™ to your evaluation of applicants. Contact us today.