Open Banking will allow businesses to be pre-approved for loans, reduce application times, and reduce fraud risk
For lenders, they will be able to make decisions based on the standardised data much quicker than through the traditional methods. It will also move the financial services industry towards being able to pre-approve businesses for loans based on real time data.
Simon Cureton, CEO at Funding Options, says: “Open banking has the potential to transform the business lending landscape, improving the experience for the customer while also improving security and response times for lenders. We’ve already seen a number of customers using the platform and successfully receiving loans which highlight the value and benefit from shared data. In the face of the current health crisis, when access to finance is vital for the survival of many businesses, reducing the time it takes to go from application to draw down is of paramount importance. Cureton continues: “In time, open banking will be adopted across the board, and we will see the true potential of how data can be used to improve all aspects of business finance. This will require some behavioural changes, and as an industry, it’s up to us to lead this revolution and improve the experience for all our customers.”
Caryl Regnault, Senior Product Manager at Funding Options, adds: “Open Banking has been around for a couple of years now and yet we’re still to experience mass adoption. Although there are several resources out there published from credible sources and industry bodies such as Which, Money Saving Experts, FCA and Open Banking Org, it can be overwhelming for individuals to understand the value of Open Banking. This opens up uncertainty which is coupled with concerns around data security. It’s important to recognise that streamlining processes using the data is not compromising the security of customer data. Regnault continues: “At Funding Options, we have made a conscious decision to ensure our business finance specialist teams are in contact with our customers over the phone to avoid relying solely on email, which could be mistaken as a phishing attempt. Our teams will talk customers through the data usage, security measures in place and consent of data access so they can understand the value.”