“Each day more people are interested in receiving financial preparation, which challenges grant providers to evaluate applicants in detail, which does not mean long and exhausting procedures or poor results that compromise the development of the company,” explains Elizabeth Moncada. Bank financing at Círculo de Crédito.
Financial institutions consider several key factors while assessing a customer's creditworthiness. These factors vary depending on the institution, the type of financial product the person is seeking, and their payment capabilities.
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Some of the common elements that financial institutions usually take into account while granting loans are:
- Credit history: They review a person's payment behavior, including their lack of punctuality in paying obligations.
- Verifiable Income: It should be verified with their pay slips to know the income of the loan aspirants.
- Warranty: In some cases, financial institutions require guarantees to back the loan; These assets can be property or assets.
- Personal Notes: For small loans, companies may request personal references to get a complete view of the applicant's financial situation and creditworthiness.
However, this traditional way of evaluating potential loan subjects is limiting to a certain extent. These parameters prevent financial institutions from evaluating their applicants in depth and exclude them from legitimate financial services.
In other words, there is other unseen data that contributes to the financial inclusion gap in the country.
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Lenders today have more parameters
“It is important for lending institutions to understand the power of alternative data provided by open finance tools, as historical or personal references have many aspects to consider,” Moncada highlights.
The financial ecosystem includes new technological tools capable of sharing and making available to financial institutions key user information to improve their decision-making. Some of these new variables that companies can use to evaluate their loan applicants are:
- Open Bank: This concept refers to data on accounts, balance sheets, movements and classification of banking institutions.
- Open Finance: These are data on formal employment, tax information in the Tax Administration Service (SAT) or investments in CETES.
- Open Economy: This information is about people's consumption and charges for basic services, including telecommunication services.
“By including a wide range of data, such as insurance, mortgages or other financial services, companies can have a more complete view of themselves in order to offer more personalized loans to users; on the other hand, consumers can make diverse decisions with greater transparency in the data available to suppliers,” concludes the expert.
Do you think taking these new sources of information into account will make it easier to get loans to meet your personal goals?
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