Tag: look ahead

Experian recently announced the new members named to its Fintech Advisory Board. The board and its members provide Experian with valuable insights and key perspectives into the unique and quickly evolving needs of the fintech industry. “For years Experian has been committed to partnering with innovators in the fintech industry to bring better opportunities to businesses and consumers alike,” said Experian North American CEO Craig Boundy. “We appreciate the thought leadership we get from our Fintech Advisory Board members and the challenge and the push that comes along with it,” he said. The board met virtually last month, welcoming representatives from across the fintech ecosystem representing payments, personal and secured loan lenders, credit card issuers, investors and others. “This was my first board meeting with Experian, and I’m very pleased to see the investment Experian has put into being the best of the three major bureaus in having the best technology to enable us to turnaround our models more quickly, and better data and alternative data sources like Boost,” said one of the new executives appointed to the board. “We are delighted to gather this group of innovators together to ensure we are consistently meeting the needs of our fintech partners,” said Experian Vice President Jon Bailey, who oversees the fintech vertical.  “Now more than ever it’s important that we work alongside them in shaping the industry and helping them meet their goals for the future,” he said. Experian’s fintech vertical provides leading-edge solutions and data across the credit lifecycle specifically designed to impact Fintech and marketplace lending companies and their customers. For more information on Experian’s fintech services or the advisory board, click here.

The financial services industry is not always synonymous with innovation and forward-thinking. While there are some exceptions with top-10 banks and some savvy regionals, as a whole, the sector tends to fall on the latter half of the diffusion of innovation curve, usually slotting in the late majority or laggard phase. Conversely, the opposite is true for fintechs who have been an enormously disruptive force of change in financial services over the past 10 years.   For many businesses, the pandemic has created uncertainty and an inability to conduct or generate business. However, the silver lining with COVID-19 might just be that it’s driving digital innovation across industries. Andreesen Horowitz, a venture capital firm, estimates businesses of all kinds are experiencing at least two years’ worth of digitization compressed into the last six months. And while they have been significantly impacted, for fintechs who were already pushing the envelope and challenging existing business models, COVID-19 suddenly accelerated financial services innovation into overdrive. Here are three challenges fintechs are answering in the wake of the COVID-19 health crisis. Digital Banking   The first lockdowns flipped the digital switch in financial services. Seemingly overnight, banking moved digital. In April, new mobile banking registrations increased 200%, while mobile banking traffic rose 85%. Likewise, Deloitte reported online banking activity has increased 35% since the pandemic started. Being mobile-first or digital-only has allowed many fintechs to win in offering presentment, activation, underwriting, and a contextual digital interface, all capabilities that will only become more relevant as the pandemic stretches on. At Square, direct deposit volumes grew by three times from March to April, up to $1.3 billion; Chime saw record signups. Continued social distancing will only serve to accelerate customers’ use of mobile and online platforms to manage their finances.  Contactless Payments  Similar to digital banking as a whole, the health crisis has accelerated the necessity for contactless payments. Whereas convenience and a seamless customer experience may have been drivers for payments innovation in the past, now, many customers may view it as a life or death health concern. Phones, wearables and even connected vehicles are empowering customers to participate in commerce while avoiding handling cash or coming in contact with an infected surface. Through their adoption of IOT-powered contactless payments, fintechs are accelerating this area of financial services to keep customers safe.  Financial Inclusion and Speeding Economic Relief  Any disaster disproportionally affects the underbanked and those living at the poverty line, and COVID-19 is no different. While it will undoubtedly contribute to an increase in unbanked households, the pandemic may also provide an opportunity to innovate through this problem. Financial inclusion was already a focus for many fintechs, who’ve made it their mission to bring equity by offering basic financial services in a transparent way. Unencumbered by legacy systems and business models, fintechs are well positioned to work across the financial ecosystem, from financial services, retail and government to efficiently and more quickly distribute benefits to at-risk groups and impacted businesses.   From their ability to quickly ingest new and novel data sources, to a focus on using a digital-first approach to delight customers, fintechs will continue to harness their strengths to disrupt financial services, even during the pandemic. How is your fintech driving innovation and customer experience during the health crisis?   Learn more

Experian’s own Chris Ryan and Bobbie Paul recently joined David Mattei from Aite to discuss the latest research and insights into emerging fraud schemes and how businesses can combat them in light of COVID-19 and the resulting economic changes. Between them, Chris, Bobbie, and David have more than 60 years of experience in the world of fraud prevention. Listen in as they discuss how businesses can shape their fraud prevention plan in the short term, including: The impacts of the health crisis and physical distancing The rise of e-commerce and consumer digital engagement Changes in criminal activity Fraud attack vectors 2020 fraud loss projections Critical next steps for the 30-60 day time frame Experian · Make Your Fraud Plan Recession-Ready: 2020 Fraud Trends

Account management is a critical strategy during any type of economy (pro-cycle, counter-cycle, cycle neutral). In times like these, marked by economic volatility, it is an effective way to identify which parts of your portfolio and which of your consumers need the most attention. Check out this podcast where Cyndy Chang, Senior Director of Product Management, and Craig Wilson, Senior Director of Consulting, discuss the foundational elements of account management, best practices and use cases. Account management today looks very different than what it has been during over a decade of growth proactive; account review is a critical part of navigating the path forward. Questions that need to be addressed include: Do you have the right data? Are you monitoring between data loads? Are you reviewing accounts at the frequency that today’s changing demands require? Listen in on the discussion to learn more. Experian · Look Ahead Podcast

Today, Experian and Oliver Wyman launched the Ascend Portfolio Loss ForecasterTM, a solution built to help lenders make better decisions – during COVID-19 and beyond – with customized forecasts and macroeconomic data. Phrases like “the new normal,” “unprecedented times,” and “extreme economic volatility” have flooded not only media for the last few months, but also financial institutions’ strategic discussions regarding plans to move forward. What has largely been crisis response is quickly shifting to an urgent need to answer the many questions around “Will we survive this crisis?,” let alone “What’s next?” And arguably, we’ve entered a new era of loss forecasting. After the longest period of economic growth in post-war U.S. history, previously built models are not sufficient for the unprecedented and sudden changes in economic conditions due to COVID-19. Lenders need instant insights to assess impact and losses to their portfolios. The Ascend Portfolio Loss Forecaster combines advanced modeling from Oliver Wyman,  pandemic-specific insights and macroeconomic scenarios from Oxford Economics, and Experian’s quality data to analyze and produce accurate loan loss forecasts. Additionally, all of the data, including the forecasts and models, are regularly updated as macroeconomic conditions change. “Experian’s agility and innovative technologies allow us to help lenders make informed decisions in real time to mitigate future risk,” said Greg Wright, chief product officer of Experian’s Consumer Information Services, in a recent press release. “We’re proud to work with our partners, Oxford Economics and Oliver Wyman, to bring lenders a product powered by machine learning, comprehensive data and macroeconomic forecast scenarios.” Built using advanced modeling and expert scenarios, the web-based application maximizes the more than 15 years of Experian’s loan-level data, including VantageScore® credit score, bankruptcy scores and customer-level attributes.  Financial institutions can gauge loan portfolio performance under various scenarios. “It is important that the banks take into account the evolving credit behaviors due to the COVID-19 pandemic, in addition to the robust modeling technique for their loss forecasting and strategic decisioning,” said Anshul Verma, senior director of products at Oliver Wyman, also in the release. “With the Ascend Portfolio Loss Forecaster, lenders get robust models that work in the current conditions and take into account evolving consumer behaviors,” Verma said. To watch Experian’s webinar on portfolio loss forecasting, please click here and to learn more about the Ascend Portfolio Loss Forecaster, click the button below. Learn More

This is the introduction to a series of blog posts highlighting key focus areas for your response to the COVID-19 health crisis: Risk, Operations, Consumer Behavior, and Reporting and Compliance. For more information and the latest resources, please visit Look Ahead 2020, Experian's COVID-19 resource center with the latest news and tools for our business partners as well as links to consumer resources and a risk simulator. Responding to COVID-19 The response to COVID-19 is rolling out across the global financial system and here in North America. Together, we’re adapting to working remotely and adjusting to our “new normal.” It seems the long forecasted economic recession is finally and abruptly on our doorstep. Recession planning has been a focus for many organizations, and it’s now time to act on these contingency plans and respond to the downturn. The immediate effects and those that quickly follow the pandemic will widely impact the economy, affecting businesses of all sizes, employment and consumer confidence. We learned from the housing crisis and Great Recession how to identify and adapt to emerging risks. We can apply those skills while rebuilding the economy and focusing on the consumer. How should you respond? What strategies should you deploy? How can you balance emerging risks, changing consumer expectations and regulatory impacts? First, let's draw upon the best knowledge we gained from the last recession and apply those learnings. Second, we need to understand the current environment including the impact of major changes in technology and consumer behavior over the last few years. This approach will allow us to identify key themes to help build-out strategies to focus resources, respond successfully and deliver for stakeholders.   Anticipate the pervasive and highly impactful market dynamics and trends The impact of this downturn on the consumer, on businesses and on financial institutions will be very different to that of the Great Recession. There will be a complete loss of income for many workers and small businesses. In a survey conducted by the Center for Financial Services Innovation (CFSI), more than 112 million Americans said that they don’t have enough savings to cover three months of living expenses*. These volatile market conditions and consumer insecurity will cause changes to your business models. You must prepare to manage increased fraud attacks, continue to push toward digital banking and understand regulatory changes.   Learn More   *U.S. Financial Health Pulse, 2018 Baseline Survey Results. https://s3.amazonaws.com/cfsi-innovation-files-2018/ wp-content/uploads/2018/11/20213012/Pulse-2018- Baseline-Survey-Results-11-16.18.pdf