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Client success Story: Nova credit

With open banking-fueled credit underwriting, Nova Credit helps bring millions of people into the financial system 

Traditional methods of building credit scores can leave some qualified borrowers out in the cold. Through consumer-permissioned access to financial data, Nova Credit helps those applicants get the credit they deserve.

It started with a passport 

Nova Credit was founded on the conviction that consumers should be able to use the power of their data to gain access to financial products. At first, that meant helping some of the millions of immigrants arriving in this country every year access credit. These individuals might have a 20-year record of paying their mortgage or credit card bills on time in their home countries, but no credit history when they arrive in the U.S.

Because of this, they can’t perform many everyday activities that require a U.S. credit score, including accessing housing and car loans. Through the Credit Passport product, Nova Credit built partnerships with credit bureaus in 20 countries around the world, using proprietary analytics to reconfigure data and create credit reports that give new immigrants an easy way to apply for credit cards, cell phone contracts, and more – and gain access to the credit they need to start their lives in a new country. 

Expanding financial access through open banking 

However, immigrants aren’t the only ones who are kept out of the financial system due to a lack of credit history. Some 62 million American citizens are facing the same problem. Traditional credit scores are culled from factors like a history of credit card use or car loans, but not everyone has that history. Yet not having a credit history doesn’t always indicate an applicant’s ability to make payments. Young adults, gig workers who deal mostly in cash, retirees with a single credit card and no loans — all struggle to qualify for basic financial services because of their thin or non-existent credit histories. 

That’s why Nova Credit created Cash Atlas. Through Cash Atlas, powered by open banking, consumers are empowered to share their banking transactions, providing a more complete picture of their financial stability. Using customer-permissioned, real-time banking data provided by Mastercard Open Banking, with services delivered through Finicity, a Mastercard company, Nova Credit’s proprietary tools analyze applicants’ deposits and withdrawals to establish an up-to-date and comprehensive view of their finances.

By recognizing more than 2,000 complex patterns of behavior, Nova Credit’s system generates a complete risk profile — including line items for income, assets, debts, and expenses — that can help credit card companies, mortgage lenders, auto dealers, and banks make more informed decisions.

Taking advantage of the speed and agility of open banking, Cash Atlas fits into lenders’ existing application and decisioning flow, making the process easy and efficient. Mastercard Open Banking covers more than 95% of deposit accounts in the U.S., allowing financial institutions to evaluate more consumers and broaden access to credit.  

And importantly, applicants’ personal information is kept safe. Mastercard open banking utilizes tokenized access to remove credential sharing from the ecosystem, backed by over 50 years of expertise in financial services security and compliance, to protect consumer data.

A more fair and inclusive future 

Through the partnership with Mastercard, Nova Credit looks forward to bringing better credit decisioning tools to a vast, underserved market of borrowers — without heightening the risk to lenders. With a growing network and cutting-edge technology, Nova Credit is committed to becoming a leading credit bureau of the open banking era.

“Lenders see the value in integrating bank transaction data in credit underwriting to better understand an applicant’s full financial profile. However, building this solution in-house is often too time-consuming and costly to maintain.  

Using Nova Credit’s industry-leading analytics alongside Mastercard’s connectivity, lenders can leverage trusted bank data access and decisionable insights to responsibly grow their business.” 

— Chris Hansen, GM of Cash Atlas Solutions  

Improving Accuracy

Cash Atlas can identify qualified borrowers who might otherwise have been declined or expose recent setbacks or improvements that traditional credit scores don’t reflect.

Protecting Privacy

Consumers can share their financial history with confidence, knowing that a Mastercard company is safeguarding their personal information.

Reducing Risk

Information permissioned to come directly from a consumer’s bank provides real-time data to give a more accurate picture of one’s ability to pay back a loan.

Certain open banking solutions are provided by Finicity, a Mastercard company.