Coremetrix for financial inclusion

Financial Technology is often seen as a sector that works for those who are already winning: something to help sophisticated users of personal and commercial finance streamline their access. It performs that function, of course, and many of us have seen our professional and personal lives enriched as a result. But FinTech also has an essential role to play in opening access, as well as improving it.

At Coremetrix, we are committed to realising that potential. Part of the Creditinfo Group, we believe data on individuals – obtained voluntarily, and focusing on personality rather than the information used for traditional credit scoring – can broaden access to financial products of all kinds. Lenders and other financial institutions across international markets agree with us, and we are partnering with a number of them to provide access to credit and other services based on who people are, not what they can prove.

So-called “thin file” and marginal customers – those who cannot provide the data banks and other service providers require, or who just fall short of their usual standards – often struggle to access the affordable and high-quality services other customers take for granted. In a world where those at the other end of the spectrum can manage their financial lives at the tap of a smartphone, we are committed to addressing the missed opportunities and limited living standards that reduced access to finance can inflict.

We recently began working with Compuscan, one of the largest independent credit bureaus in Africa, to improve the lives of the almost 20 million South Africans whose access to finance is severely or totally limited because they lack the kind of data financial institutions use when making lending decisions. Compuscan has also identified an additional 10 million consumers regarded as very high risk or high risk borrowers.

We aim to help these individuals by complementing traditional credit scoring techniques with our unique psychometric quiz, which considers their personality, motivations and likely behaviour. Our data, and that of lenders, suggest that integrating our approach with the traditional one can both improve acceptance rates and even reduce defaults: we firmly believe that the benefits of going beyond the standard assessment procedures are felt by providers and not just consumers.

It’s not just credit scoring: we are also working with the insurance industry to transform unfair pricing structures, to the ultimate benefit of all customers. One of the UK’s leading insurance providers is using our approach to risk assessment to help determine the likelihood of consumers making a claim against their motor insurance policy. By deploying our personality-based test alongside its established processes, insurers can better determine both behavioural traits likely to result in an accident and a customer’s likelihood of making a fraudulent claim.

To date, we have helped more than 10,000 unbanked or rejected customers find access to credit without any significant increase in bad debt for lenders. This, we believe, bears out our central thesis that there is a correlation between an individual’s personality and their credit intent.

As we build on our successes in both the credit and insurance markets, we want to work in new markets and sectors to improve more lives – and increase the efficiency and profitability of the businesses with which we work. As part of the FinTech community ourselves, the sector is of vital importance as society develops, becomes increasingly mobile, more inclusive and technologically advances.

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