October 19, 2021
When you know a thing, to hold that you know it and when you do not know a thing, to allow that you do not know it: this is knowledge ~ Confucius
Maneuvering through a maze often reflects the highs and lows of daily life, sometimes ending with a treat, other times a blocked pathway. Borrowing money or making purchases on credit may feel like crawling through a maze, but the good news is the barriers are coming down. The lending industry is reinventing itself in the aftermath of Covid, where mobile shopping surged, credit scores became unreliable, and creative opportunities for new lending entrants emerged.
Banks and credit unions provide financial products to most of America, however, the pandemic revealed insights about disparities in the American culture. None became more apparent than the alarming gap in the lending space, ignoring the underserved population and mistakenly turning down an additional segment of capable borrowers due to incorrect data. According to a 2021 survey by Lendingtree, “7% of U.S. households are unbanked, opening doors to a modern-day market of new lenders.” Allie Johnson’s article Denied: Too Many Americans Have Been Getting Turned Down for Credit in 2020, quotes a poll by Bankrate saying that “21 percent of U.S. consumers have had an application for credit rejected in the middle of the coronavirus pandemic because a credit card company, lender or landlord deemed their credit score too low.”
Today’s smart, tech-savvy lenders are recognizing and utilizing the robust knowledge of the unencumbered, data providers to assess risk and open doors to more borrowers. Unlike banks and their complex infrastructure, the modern-day data providers create relevant, innovative, custom-made products quickly and without legacy constraints. The providers and their data scientists have discovered the power of diverse data, how to manage and analyze it to reveal consumer spending attributes and financial behavior. Examining vast data points creates more lending opportunities for those borrowers who were never considered eligible due to the myopic credit scores.
There is always a leader in every industry, often it is not the biggest kid on the block, rather the one that has the more intelligent, futuristic team who embraces a smarter stash of software, tools, and understanding of artificial intelligence. Stage right, RIBBIT.ai, empowering lenders and liberating borrowers with revolutionary credit measurement tools. RIBBIT’s revolutionary analysis of diverse bank data paints a landscape picture of a consumer’s ability-to-pay rather than a limited snapshot. RIBBIT’s behavioral analytics harness the predictive power of open banking and payment data to deliver insights on 99% of consumer bank accounts.
The days of accepting credit bureau scores at face value are over. RIBBIT dissects massive amounts of consumer attributes and breaks them down into personal insights. RIBBIT’s data scientists use their lending expertise to recognize and examine patterns, trends, progress, strengths, difficulties, and vulnerabilities in a consumer’s financial behavior. Targeted algorithms and manipulated artificial intelligence provide lenders with intimate and penetrating behavioral indexes based on a scale of 1-10. RIBBIT’s crucial information clarifies risk, influences lending decisions, and demonstrates how more consumers can afford goods and services.
Stay tuned . . .
Which is the true nightmare, the horrific dream that you have in your sleep or the dissatisfied reality that awaits you when you awake ~ Justin Alcala
Like many life-altering issues in our country, we are keen on understanding, but unfortunately, laissez-faire on action. How many times has our country raised the debt ceiling avoiding a government shut-down rather than resolving the debt problem? The Federal Reserve Bank of New York’s Center for Microeconomic Data reports that in August 2021, the U.S. Public Debt was 28.23 trillion dollars, 1.7 trillion higher than last year, more than quadrupling since 2000. Yikes!
A man should first direct himself in the way he should go. Only then should he instruct others ~ Buddha
Old fashioned lay-a-way made so much sense, a way to reserve your product, and pay for it when you actually had money, thus taking possession. It gave consumers time to rationally think about the necessity of the purchase and time to budget the appropriate money. Lay-a-way was a safeguard against impulse buying and going into debt, a fear today that doesn’t resonate as much with consumers or merchants. As a result of Covid, online shopping grew-up, and the Buy Now Pay Later (BNPL) market arrived or rather exploded on the POS scene giving credit cards a run for their money.
Whoever acquires knowledge and does not practice it remembers him who plows his land and leaves it unknown ~ Sa’di Gulistan
What could possibly entice Rick Fiorito, a just-retired, financially secure, new Floridian, and renowned payments-guru to even consider leaving the beach for an opportunity to disrupt the financial services landscape? Rick, at least, let the dust settle from your recent industry-wide retirement announcement from Mastercard. “Joining RIBBIT.ai as their COO is an opportunity I simply couldn’t miss,” Rick knowingly smiles.