Finicity is part of the Mastercard family. Our open banking platform provides the financial data you need.

One day at a time. That was Sam Magtanong’s mantra when COVID-19 hit, threatening not only the long-dreamed-of expansion of the San Diego microroastery he built with his wife and two friends, but of the business itself.

“My vision was, if I could stay open for the next day, and if I can pay my staff one more day, and if I can serve one more cup of coffee, there’s a blessing there,” he says. “We just looked at it that way, and we kept just trying to stay open another day.”

For many entrepreneurs, accessing the capital they need to build their businesses can be challenging even in flush times. When Sam and Beverly Magtanong and their partners Jelynn Malone and Mike Arquines opened their first Mostra Coffee location in 2018, they struggled with cash flow and turned to Lendio and Finicity for a loan.

To help small businesses get the credit they need to grow and thrive, Lendio harnesses Finicity’s open banking platform, which lets people more easily share their banking data with other banks, lenders and fintech companies. It gives lenders a more holistic view of a person or business’s finances to help them determine their creditworthiness.

“Eliminating financial hurdles and introducing small business owners to capital opportunities they may not know exist can extend the spirit of entrepreneurship to more people,” says Denada Ramnishta, senior vice president of Lender & Partner Strategy at Lendio.

The pandemic hit when Mostra Coffee was getting ready to open a second coffee shop. Lendio helped Mostra Coffee obtain a U.S. Paycheck Protection loan to keep the business running, hire back staff they had laid off at the start of the pandemic, and finish work on their second location. “I went from feeling a sense of desperation to feeling a sense of relief,” Magtanong says.

With the newest round of PPP loans, Lendio has started working with Finicity’s open banking platform to authenticate bank statements to reduce the risk of fraud in the process. Lendio and Finicity will be bringing their joint capabilities to small businesses in the U.K. and other markets in the coming months through a new strategic agreement. To read more about Mostra Coffee and the open banking effect, go to the Mastercard Newsroom.

When Kristy Kim moved to the U.S. with her family from South Korea, she worked hard to achieve the American Dream. But when she graduated from a top university and landed a high-paying job in investment banking, she realized her years of scrimping and saving didn’t pay off in one crucial way – she had no credit file, so she wasn’t eligible for a car loan. She had to pay cash. 

Now Kim has launched TomoCredit Inc., a startup that uses with Finicity’s open banking platform to determine which applicants are qualified for credit, and how much credit to offer them. Traditionally, lenders use a credit score, but many people, including immigrants to the U.S. and young people, have not built up a credit history. TomoCredit’s research indicates that legacy lending policies keep 40 million people from accessing credit and the ability to build wealth. 

Using consumer-permissioned real-time data from than 10,000 financial institutions, Finicity can help TomoCredit get a clearer picture of an applicant’s financial health, improving risk assessment and credit decisioning. Once approved, applicants receive a TomoCredit Mastercard credit card with no fees and 0% APR. 

“Enabling people to access and control their data, while ensuring best practices to protect both that data and the consumer, will continue to drive tremendous innovation that increases financial literacy, inclusion and health,” Finicity CEO Steve Smith says. 

Want to learn more about Kim’s journey, how the TomoCredit Mastercard works, and how TomoCredit. Finicity and Mastercard are enabling inclusive credit? Read more on the Mastercard Newsroom.

If you’re a lender, landlord, or employer, you know this to be true: it’s crucial to have up-to-date, verified information about applicants. You don’t want to underwrite a mortgage, provide a car loan, or rent an apartment to someone you don’t have needed information on. You want to make sure applicants can do what they’re promising.

We’re talking about verification of income and employment, and it’s what makes many significant transactions or agreements possible. It allows businesses to take wise risks and helps consumers make financial decisions that are right for them. Let’s take a closer look at what employment and income verification services are, how they work, and how businesses can leverage Finicity Lend™ for more streamlined and accurate verification experiences.

What Is Income and Employment Verification?

Income and employment verification—or verification of income and employment (VOIE)—is just what it sounds like: a way to ensure that someone’s stated income and employment are accurate. Employers and lenders typically use VOIE for more significant purchases or agreements. Lenders might use VOIE for preparing a mortgage or other loan, landlords for tenant screening, and employers for background checks.

If, say, a lender completed a VOIE for a potential borrower, what would they see?

How Does Online Income and Employment Verification Work?

Verifying income and employment can be pretty simple using consumer-permissioned data. For example, at Finicity, here’s how it works:

First, the consumer grants permission for their data to be used either from their financial institution or a payroll provider. They can upload a pay stub, if needed, or other income data.

Second, we digitally extract and verify the income and employment data you need. We’ll analyze the data and add insights to provide a historical view of income and/or employment and confirm the current employer and/or income level by cross verifying employment data with transactions in their bank account.

Finally, we provide a thorough, but easy-to-read report or just the specific data you need.

Other services typically don’t connect directly to banks and use lagging data like database solutions or manual verifications that request information directly from the applicant’s employer or even the IRS, for example. That can take a long time, though (some documents may take months to make it to you), so it’s worth it to go with a service that can automate employment and income verification. It’ll do the heavy lifting for you in minutes, making your life simpler.

The Benefits of Using Finicity’s Open Banking Platform for VOIE

When choosing an online income and employment verification service, you don’t just want a simple process. You also want accurate information and the assurance that the service is keeping your data secure. Finicity’s open banking platform is provides those important benefits, plus some nice perks:

Additionally, Finicity’s solutions mitigate risk for lenders and reduce liability for prospective employers. We act as a consumer reporting agency (CRA), so we follow strict standards that maintain the highest data accuracy and consumer protection.

First, our data meets and exceeds the demanding data quality requirements of investors and GSEs like Fannie Mae and Freddie Mac. In fact, our data is used for high-dollar decisioning governed by strict regulatory oversight, so it’s ready to be leveraged in any use case.

Second, we use consumer permissioning, which means that borrowers have control over how their data is shared and used. That’s a win-win for consumers, lenders, landlords, and employers. 

Third, we implement best-in-class physical, technological, and procedural security safeguards similar to those used by major banks, credit card companies, and trading firms. As security threats evolve, we evolve to stay ahead of the curve. 

How Finicity Is 3x More Successful Than the Leading Automated Verification Company

Currently, most businesses conduct verification of income and employment manually. For example, mortgage lenders contact employers directly to request income information and other documents. They’ll ask for verbal confirmation, or they may need to wait for fax or email verification. Sounds pretty old-fashioned, but that’s still the way a lot of this business is done.

Even some forms of online income verification may be slower or less secure than they could be. In today’s fast-paced, threat-laden business world, that’s bad news. Finicity’s VOIE solution was designed with these issues in mind, and our solution is three times more successful than the leading automated verification company. 

Employment and income verification services help businesses and consumers take wiser financial risks. To learn more about how Finicity’s VOIE service can help you make smart decisions, request a demo of our income and employment solutions.

It may be that the worst is yet to come regarding a credit crisis and long-term economic hardship. According to a survey of 2,000 U.S. consumers Finicity conducted last November, people stated they were just as concerned about their credit in the wake of job losses or financial hardship near the end of 2020 as they were during the initial onset of the pandemic. In fact, more than two-thirds (65%) of respondents said they are concerned their credit score will go down in the next six months because of the pandemic.

Read the full article.

Rebecca Ayers of FinLedger discusses the anxiety consumers have about their personal finances as the covid-19 pandemic continues to impact financial security. 
“A recent report conducted by Finicity revealed that about 64% of respondents impacted by job/income loss due to the pandemic said that it’s hard to keep up with bills and payments. And, 95% of those impacted are concerned about their ability to rebuild credit and take out a loan after the pandemic ends.”
Read the full article. 

A smooth verification of income process is crucial for mortgage lenders to satisfy customers and maintain efficiency. Unfortunately, with consumer expectations evolving and with better, more secure digital verification solutions on the market, manual verification simply doesn’t cut it anymore.

Today’s winning solutions streamline processes for everyone involved. More efficient workflows and solutions satisfy the expectations of digital consumers and increase ROI for lenders. Fintech and the digital mortgage it enables are both revolutionizing income verification and transforming risk management. Here’s how. 

What Is Income Verification? When Mortgage Lenders Use Proof of Income

Mortgage lenders need to accurately determine whether or not a potential borrower is a risk. Lenders use a series of verifications to assess that risk, including income verification. A lender will request a verification of income to check that a borrower is bringing in enough money to make their monthly mortgage payments. If a verification of income report shows that a loan amount is higher than a borrower can pay back, that borrower is less likely to receive a loan.

Lenders may complete income verification using a few different methods. Historically, lenders have requested manual documentation to verify a borrower’s income. This often involved delivering a paystub and the borrower’s most recent W-2 form along with bank statements. Today, more borrowers can submit documents electronically, via email, or through a lender’s online portal.

However, with digital mortgage solutions and digital verifications, specifically, on the rise, manual income verification is becoming a thing of the past. Instead of relying on paper documents, borrowers can authorize lenders to access their financial data, where they can quickly and easily verify income. 

It’s not just that manual verification of income is behind the times (even though it is). Manual verification, while a tried-and-true method for many lenders for a long time, presents concrete drawbacks and even risks that digital verification eliminates.

Manual verification simply takes longer. Hunting down relevant documents and generating friction with a frequent back-and-forth with borrowers takes time that drags out the origination process. Longer origination times mean lower ROI for lenders and less satisfaction from the consumer.

And that consumer satisfaction matters. In this digital economy, your borrowers expect increasingly streamlined processes. High-friction paper chases just don’t meet expectations anymore. And you don’t just want to meet expectations; you want to exceed them. Failing to meet today’s consumer expectations frequently results in fewer returning customers, fewer referrals, and all-around lower brand loyalty.

This is where fintech comes in.

How Fintech Streamlines Income Verification For Better Credit Decisioning

Fintech services remedy the problems inherent in manual verification with secure, convenient technology that streamlines processes for lenders and satisfies digitally-accustomed borrowers. Instead of requiring borrowers to dig up old documents, financial technology can verify income by directly accessing a borrower’s financial data. Fintech aims to simplify the mortgage lending process for everyone involved.

Digital verifications streamline mortgage lending by removing friction with borrowers, cutting origination times with fast processes, and moving borrowers more quickly through the conversion funnel. The most innovative technology also goes a step beyond simply removing friction with borrowers to also deliver a quick and secure user experience that simplifies the verification process.

Streamlining income verification isn’t just about speeding up the process. Digital verification solutions also address the risk- and fraud-related problems associated with manual verification. Physical documents received from borrowers can be unreliable. Inaccurate information leads to poor decisioning. Legacy technology that requires copy-pasting and re-keying leaves ample room for error. More risk and higher chances of fraud cost you more time and money in the end. Early Warning reports that “instead of getting information directly from financial institutions,” relying on manual verification “costs banks and lenders millions of dollars.”

Fintech ultimately improves credit decisioning with solutions that provide more accurate data and deeper insights into a borrower’s financial situation, all while cutting the time and risk associated with manual processes.

What’s Next? How The Latest Technology Will Better All Lending Platforms

The proliferation of financial data, and the open banking platforms that enable its access, are continuously evolving, especially amid the digital acceleration brought about by the pandemic. That latest technology and the innovative solutions it powers will improve lending platforms in every way, from streamlining the overall origination process to enabling more accurate, secure verifications from multiple data sources.

An abundance of consumer-permissioned data enables lending platforms to better serve consumers and increase ROI by easily and simply delivering data from multiple sources that may have been previously unavailable. Verifying employment gets easier when lenders can receive payroll and paystub information directly. Lenders that need to refinance or consolidate a loan can rapidly get the necessary loan details. The combined speed, accuracy, and security of these data connections, as well as increased access to additional data sources, enable mortgage lenders to develop the agility necessary to hone their competitive edge and adapt to future changes and challenges.

The Finicity Solution Is Transforming Risk Management For Traditional Banks 

The more accurate, more secure, and more convenient solutions enabled by fintech have the potential to transform risk management for traditional banks and lenders. But transforming risk management involves more than delivering better insights to mortgage lenders; it also involves meeting the digital borrower in their digital ecosystem with a solution that benefits the consumer as much as it does the lender. 

Enter Finicity Lend.

What is Finicity Lend?

Finicity Lend is a suite of fintech solutions that easily integrates into any lending platform and streamlines the verification process for mortgage lenders. Finicity’s open banking platform powers these solutions and places the consumer at the center of the verification process, which benefits everyone involved.

It goes like this: when it’s time for the borrower to verify their income, the lender kicks off the consumer permissioning process. The borrower then securely consents for the lender to access their financial data. Finicity then generates a “Verification of Income” report using data straight from the borrower’s financial institution. This guarantees the most accurate data, direct from the source. And to top it off, a verification process that could have taken weeks now takes minutes.

The Finicity Lend Verification of Income report includes:

How Finicity Lend Streamlines Income Verification and Transforms Risk Management

Finicity Lend is the answer to the flaws inherent in manual income verification. And it’s all thanks to data solutions that revolve around consumer empowerment. Using consumer-permissioned data, provided through Finicity’s open banking platform, Lend gives consumers more control over and transparency into their financial data and its benefits. And when the consumer is empowered, mortgage lenders reap the benefits, too.

Thanks to Finicity Lend’s data solutions, both mortgage lenders and borrowers can enjoy a streamlined verification process. Steve Smith put it best: “Once [consumer permissioning is] done, we’re able to gather all appropriate data across multiple accounts, rapidly analyze it and send a verification report to the lender. No papers. No multiple requests. No questions on validity of the data. All done in minutes, not weeks.”

Access to real-time data is the foundation of this streamlined process. Our verification solutions pull and analyze data straight from financial institutions. And all it takes is a report refresh to get immediate updates to reports. No more hindering the origination process with long periods of back-and-forth, hunting down bank statements and other documents. To top it off, our data intelligence layer analyzes financial data and ranks identified income streams with confidence scores, which both streamlines the decisioning process and provides more accurate data for better risk assessment.

Lend also streamlines the lending process and mitigates risk in the long-term. After all, fraud that comes back to bite lenders usually costs not just money, but time. Access to real-time data directly from financial institutions drastically reduces the chances of fraud when compared to verifications completed with manual verification. Our Lend solutions even compare transaction data with other source data (such as employer-provided data) for an additional layer of security.

In the end, streamlining verification of income with Finicity Lend enables mortgage lenders to close more loans more quickly. That enables greater agility, more space for more business, and more money saved in expenses. And with everything about Lend designed to put the consumer front-and-center, everybody leaves the lending process happy.

Thanks to Finicity Lend, you get the information you need for income verifications, and you get it fast. Your borrowers get a better, more empowering experience. You get a more reliable assessment of risk. And both of you can enjoy a streamlined income verification process. Learn more about Finicity Lend’s data solutions and request a demo to see streamlined income verification in action.

Finicity’s newly announced solution suite will help the credit decisioning process for lenders and enabling open banking. Open banking allows people and businesses to benefit from their own financial data. This includes determining how and where third parties — such as financial technology companies (FinTechs) — can access that information to provide new services like money-management programs or initiate payments on their behalf.

Read the full article.

Samantha Hurst of Crowdfund Insider covers the launch of Finicity Lend, an integrated solution set of open banking data services that provides banks, lenders, and fintech developers access to tools that enable their borrowers to directly permission data and insights into lending decisioning processes.

Read the full article.

Finextra provides details on the launch of Finicity Lend, an integrated solution set of open banking data services, provides banks, lenders and fintech developers access to tools that enable their borrowers to directly permission data and insights into lending decisioning processes.

Read the full article.

Finicity’s new integrated set of credit-decisioning services to digitally transform lending with accurate, real-time and consumer-permissioned data

SALT LAKE CITY, Utah – Sept. 28, 2020 – Finicity, a leading provider of open banking solutions, today announced the rollout of Finicity Lend™ for credit-decisioning. Finicity Lend, an integrated solution set of open banking data services, provides banks, lenders and fintech developers access to tools that enable their borrowers to directly permission data and insights into lending decisioning processes.

Finicity Lend addresses the need for more efficiency and accuracy, better risk management, real-time insights, and enhanced credit-decisioning by delivering consumer-permissioned financial data, automated and predictive analysis through powerful analytics, and expanded data sources. 

Finicity Lend incorporates several new data services with existing data services, as well as new capabilities in the Finicity open banking platform to create a more expansive, integrated solution. This platform and Finicity’s leading APIs provide the foundation for transforming the credit-decisioning process. 

“The growing impact of the COVID economic crisis and the potential impact on consumer credit confirms an issue that has existed for some time now — a need for a deep evaluation of the credit review process and how consumers can become empowered to get more benefit from their own financial data,” said Finicity CEO and Co-founder Steve Smith. “Our new Finicity Lend integrated solution set will complement the current credit rating system while leveraging the tremendous advantages of open banking to create an industry standard for assessing a borrower’s ability to manage a loan going forward. Real-time, permissioned data from multiple financial accounts is the lifeblood of our secure open banking platform, and empowers consumers to make better financial decisions, to mitigate risk for lenders and can increase overall financial inclusion.”

New Capabilities — Cash Flow Analytics, CRA Data Services and Payroll Data

Leveraging the Finicity open banking platform’s robust data intelligence layer, Finicity Lend provides a new alternative data service, Cash Flow, that analyzes financial account data delivering a broad set of cash flow attributes. This gives lenders more accurate insights into a small business or individual’s creditworthiness. The Cash Flow analytics service digitizes and automates the capture and delivery of data that previously required significant combinations of manual and automated processes to extract and analyze. The use of this alternative data is supported by the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Federal Deposit Insurance Corporation, National Credit Union Administration, and Office of the Comptroller of the Currency as referenced in their Interagency Statement.

Also new to Finicity Lend are transaction and statement data services that are delivered in accordance with  FCRA compliance requirements, ensuring that Finicity’s consumer-permissioned data meets the legal requirements of the Fair Credit Reporting Act.  

Finicity’s decision to position itself as a Consumer Reporting Agency also ensures consumers have the ability to review, dispute, and correct any inaccurate information. This offers the most consumer-centric and consumer-friendly approach to using aggregated data within the credit-decisioning process.

Building on its leadership position with financial institution coverage, Finicity has added ADP as the first of many new payroll data sources to its open banking platform. Providing a direct connection to the payroll provider further enhances its ability to verify consumer-permissioned income and employment details — critical to many lending use cases — with real-time, direct from the source data.

Finicity Lend integrated solution set includes the following data services: 

Expanding the types of data used to determine creditworthiness addresses longstanding consumer concerns that have surfaced more recently because of the global pandemic and resulting economic crisis. According to a recent study by Finicity, 95% of consumers negatively impacted by the economic crisis said they are concerned about their ability to rebuild their credit or take out a loan following this financial situation. Additionally, 82% of consumers said they believe the current credit review process and criteria need to change to make it easier for responsible borrowers to prove their creditworthiness. A majority of consumers stated that they would be willing to share current income information, payment history for utilities and other services, as well as rent history to give lenders an accurate view of financial standing and ability to pay.

Finicity Lend will make the credit process faster and more efficient for lenders who offer all kinds of loans, including mortgage, auto, small business, personal and more. Today’s lending process is in the midst of a vast digital transformation, placing Finicity and its technology at the forefront of this big-data revolution and the broader adoption of open banking in the United States. In June, Finicity announced that it had agreed to be acquired by Mastercard, a move which strengthens Mastercard’s existing open banking platform that has existed in Europe since 2019.

Open banking gives people and businesses more control over and benefit from their own financial data. This includes determining how and where third parties — such as fintechs or other banks — can access that information to provide new services like money management programs or initiate payments on their behalf. 

Finicity is a founding member of the Financial Data Exchange (FDX), an organization dedicated to establishing broader industry standards for open banking in North America. Smith currently serves as co-chair of FDX and played a key role in its creation. Finicity also has established relationships with a wide variety of service and application providers that allow individuals and organizations to better understand, manage and control financial processes — everything from budgeting, saving, and borrowing to transacting, investing, and lending. 

To learn more about the Finicity Lend integrated solution set, be sure to check out our virtual booth during LendIt Fintech USA 2020 from Sept. 29–Oct. 1 or request a demo today.

About Finicity

Finicity’s mission is to help individuals, families, and organizations make smarter financial decisions through safe and secure access to fast, high-quality data. The company provides a proven and trusted open banking platform that puts consumers in control of their financial data, transforming the way we experience money — everything from budgeting and payments to investing and lending. Finicity partners with influential financial institutions and disruptive fintech providers alike to give consumers a leg up in a complicated financial world helping to improve financial literacy, expanding financial inclusion, and ultimately leading to better financial outcomes. Finicity is headquartered in Salt Lake City, Utah. To learn more or test drive its API, visit www.finicity.com.