We’re back from this year’s LEND360 conference. It was another great event: insightful presentations, engaging conversations, and a chance to reconnect with friends and colleagues. In this blog post, learn about 3 major topics that leading online lenders were discussing at this year's show.
3 Hurdles For Online Lenders
What made this year’s conference different? Here’s our list.
- Fraud is getting worse.
Online lenders have no uncertainty about this next point: fraud operators are more crafty, diligent, and costly than ever before. Part of the problem is that all those headline-making data breaches of recently years have leaked torrents of identity data, which fraud operators are now putting to good use. And fraud operators, thwarted by the widespread adoption of EMV chips, are looking for new targets, including online lending, for adding to their ill-gotten gains. Among the realizations here: lenders need better IT defenses as well as identity intelligence that is more accurate and less hackable that the knowledge-based approaches that sufficed in simpler times.
- The big credit bureaus have more data, but lenders are seeking alternatives.
In the past year or so, several alternative data vendors were acquired by the major credit bureaus. Their approaches, price points, and volume requirements have changed accordingly. Online lenders we spoke to are looking for alternatives; they’re really looking for alternative, alternative data resources. In other words, now that the old guard has been acquired, they’re looking for other small, nimble companies with unique data sources that have the ability to unlock predictive insights with less data. In a fast-moving market, being alternative can get you the insights that deliver a competitive advantage.
- Mobile account opening needs to be streamlined.
More online lenders are offering customers the chance to apply for credit on their smartphones and tablets. But the interfaces are still cumbersome, requiring lots of typing. Many lenders we spoke to were interested in taking advantage of automated services for extracting data from identity documents such as driver’s licenses and using it to instantly populate fields in a form. Lenders know that digital natives are finicky customers. Bog them down, they’ll click away. Give them a frictionless experience, they’ll close the deal.
Whether it’s the potential effects of the midterm elections or the effects of a tightening credit market and potential economic downturn, lenders are bracing for uncertain times. But bracing doesn’t mean freezing in place. On the contrary, online lenders are looking to make strategic investments now to ensure that this momentum continues. At Accelitas, we believe the raising your Identity Intelligence is an important step to addressing these challenges. Many of these ideas were discussed in our Lend360 panel session on Monday.
The Importance of Customer Identity Intelligence
The conference session “Protecting Your Brand: Developing a Strategy for Fraud Prevention and Data Security" featured Accelitas CEO Greg Cote, who talked about the importance of identity intelligence for both preventing fraud and optimizing identify verification capabilities to support financial inclusion. Our approach is unique in the market, because is doesn't just focus on keeping out the bad, but instead leverages intelligence to help lenders identify and access more good customers.
Below are some points on how Accelitas and our Customer Identity Intelligence solutions can help online lenders:
- Streamline mobile account opening by extracting ID data in real time for auto-form-fill.
- Apply artificial intelligence (AI) and alternative data to screen more customers more accurately in real time, enabling lenders to safely grow accounts even from thin-file and no-file households
- Also apply AI and alternative data to detect fraud, including identity theft, more quickly
- Re-evaluate rejected accounts for overlooked indications of creditworthiness, enabling lenders to grow accounts with the leads they’ve already purchased.
Want to learn more? Download our eGuide, 'The Invisible Marketplace' and learn 5 ways Artificial Intelligence and alternative data can help lenders secure good customers in a digital world.