Lending, it has been said, is as much an art as a science – and even in the 21st century, it is fraught with friction. But with advanced technologies in the mix and with data-enriched cooperation between lenders and borrowers, the process becomes much more positive for lenders and borrowers.

Lisa Kimball, senior vice president of product and strategic partnerships at Finicity, a Mastercard company, told PYMNTS that open banking will streamline the lending department and make it more customer-friendly.

The conversation took place against a backdrop where data shows that 61% of financial firms want to leverage technology to improve openness and data sharing for payments modernization. And while Kimball said the lending service may not represent “a new use case for open data sharing,” she stressed that it continues to mature as financial institutions move towards digitalization. complete.

Institutions that harness open banking technology in the process can minimize risk, reduce friction, and speed up service to consumers and businesses. This shift to greater efficiency comes when end users grant account authorization upon subscription, which can then be used to speed up reimbursement as well.

From integration to reimbursement

“Think of it as someone providing income verification, being eligible for a loan, and then being able to connect those same accounts for repayment without having to go through a separate secondary stream,” Kimball noted. “So [open banking] Truly streamlines the end-user experience while keeping them absolute control over how their data is used.

End consumers grant permission, Kimball said. At the same time, repairers gain additional insight into the health of their portfolio, as well as an opportunity to reward top borrowers.

Throughout the process – starting with the integration – open banking platforms can create a great borrower experience, she said.

She gave the example where a consumer can use accounts that have already been validated (maybe even for a use case other than borrowing) and choose to link repayments from those accounts with one click. Open banking can also help put an end to some of the more complicated lending processes, such as micro-deposits, which can take days to settle. Also (and thankfully) are the days when customers had to hand in void checks to set up ACH payments.

“With open banking tools,” she said, “we can validate, connect and authorize account-to-account payments in minutes.” For lenders, the tools allow payments to be processed in real time and even provide users with alternative payment options.

“The open banking solutions in this space really offer a lot of confidence in the security and validation that exists with these authenticated accounts,” she said.

Of course, data remains the glue and connects workflows, account openings and authorizations. Companies like Finicity, she said, can obtain precise details of the current account owner, adding another layer of security to the entire financial services ecosystem.

Looking to the future, she said, lending evolves rapidly. Regulations will also continue to evolve, where the United States has traditionally been more market-oriented than other regions and countries when it comes to bank openness.

As she told PYMNTS, “We will continue to see consumers and borrowers demanding experiences that resemble experiences they have had in other facets of their lives:” It’s easy. I can do it from where I am and when I want to, and there is a very simple way for me to transact through a smooth and easy-to-understand experience. ‘”



On: It’s almost time for the holiday shopping season, and nearly 90% of US consumers plan to do at least some of their purchases online, up 13% from 2020. The 2021 Holiday Shopping Outlook, PYMNTS surveyed over 3,600 consumers to find out more about what drives online sales this holiday season and the impact of product availability and personalized rewards on merchant preferences.


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