Every once in a while, a new technology, an old problem, and a big idea turn into an innovation ~ Dean Kamen 

The pandemic, a cruel influencer of the 21st century, left few unscathed in the business world; some were harmed, others obliterated, some were saved, others benefited, but all were impacted. One business’s misery was often another’s gain. In the financial arena, ideas that weren’t considered before, jumped to the forefront of people’s thinking, changing the way business is conducted. Alternative financing/lending, a great example of an industry segment rising from the pandemic ashes, faced great upheavals, stalling its progress until dramatic changes were instituted.

As its workforce disappeared, the alternative lending space hit the skids during the virus, money was scarce, and uncertainty clouded the board rooms. When access to capital is suddenly inundated with obstacles, even when demand is spiking, priorities must be adjusted, budgets examined, and stricter standards enforced. As people lost jobs and became desperate for financing, the survivors in the lending space recalculated its course to meet the increasing demands for remote and online access to all financial services. Enhancing user experience and implementing data analytics into the approval process moved to the forefront of the lending model.

The crisis blasted the doors open to digital commerce in the payments world with 69% of consumers using the mobile apps of their financial institutions to do their banking, according to a February article, Account Opening and Loan Servicing, by PYMNTS.com. Today, consumers no longer feel tethered to banks and credit unions; mobile devices have empowered and liberated people to manage their finances turning to hip alternative financing as a welcome alternative to the banks’ rigid protocol.

Cashless payment systems and cryptocurrency are realities, further impeding the traditional banking market from catching up. The solution for many financial institutions is to merge its services with alternative financing options usurping their technology to modernize the restrictive banking products. For example, RIBBIT, an expert in bank behavior analysis, uses AI and technology to unlock doors for more inclusive and equitable loans based on a much broader, deeper, and insightful picture of a consumer’s financial well-being.

• RIBBIT’s Valda Hilley, Manager of Sales Development, sums it up – “Those entities that rely on basic KYC metrics are merely building a shadow, a silhouette, or a 2-dimensional cardboard cutout of a potential customer. With RIBBIT, our data, analytics, and models discover a person’s ‘intent’ and characteristics that make a digital persona 3-dimensional. It’s like the difference between a balloon without air and one that’s blown up. We blow up the balloon.”

As payments through bank accounts markedly increase, examining transactional history offers the modern-day landscape of a person’s financial behavior and resulting affordability index.

According to Richard Zaing’s February article, Consumer Banking: Statistics and Trends:  93% of Americans have bank accounts, 71% of bank customers regularly use online banking, 43% use mobile banking, and debit cards use is 22.8 times a month. This digital payment trend empowers RIBBIT’s data scientists to extract thousands of expenditure attributes from a single bank account.

Merging RIBBIT’s incisive services with brick-and- mortar banks/credit unions and alternative lenders produce a powerful, unencumbered lending tool for more accurate, unbiased, inclusive, and reliable approvals.

Stay tuned . . .