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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Experian is launching its Mule Score, a new service to help banks identify and close down money mule accounts.
Money mule accounts are used by criminals to launder money and facilitate fraud.
According to Experian, 42% of first-party checking account fraud is mule-related.
Information services company Experian has unveiled the Experian Mule Score, a new service that will help U.K. banks identify and shutter so-called money mule accounts, or accounts that criminals use to launder money and facilitate fraud.
The “mules” are people that allow criminals to use their legitimately obtained accounts in exchange for cash. Banks can’t see where the money is coming from or being sent to. This lack of visibility makes it difficult to identify and investigate accounts being used by money mules. The issue is widespread– according to Experian, 42% of first-party checking account fraud is mule-related.
“Mule Score is the first solution of its kind, giving financial companies a comprehensive view of account activity, helping prevent them from onboarding potential mule accounts and detect already opened accounts which are suspicious,” said Experian UK&I Managing Director, Identity and Fraud Eduardo Castro.
Experian anticipates the new solution will help banks avoid onboarding suspicious accounts before they are opened, reduce fraud losses and operational costs, support at-risk consumers, and prevent fraudulent funds entering the financial system.
Experian is leveraging its bureau data, combined with account opening history and turnover activity to create the Mule Score that flags potential money mule activity. The score, which was developed by Experian DataLabs, also uses machine learning to model characteristics of more than 200,000 historical mule cases. As a result, banks can assess their accounts to easily spot suspicious activity.
“The level of fraud and financial crime in the U.K. represents a threat to financial institutions and their customers,” said Castro. “Experian, thanks to our data, analytics and technology, is uniquely placed to help. We are committed to helping eliminate financial crime and ensuring safe financial access for all.”
Originally known for its consumer credit reporting, Experian has leveraged its extensive access to data and has honed its expertise in fraud prevention technology. In 2021 alone, the Ireland-based company prevented more than $2.25 billion (£1.8 billion) in fraudulent transactions. In addition to consumer credit reporting and fraud prevention tools, the company also offers identity theft protection, credit building tools, and a loan comparison marketplace. And on the commercial side, Experian provides a range of services for small businesses, including business credit reporting, marketing products and services, debt collection tools, and more.
Global information services company Experian launched a new fraud prevention solution this week.
The new offfering is a fintech-focused version of its fraud prevention data network Hunter.
Hunter takes a collaborative approach to fraud mitigation. The technology has saved businesses more than $6.5 billion a year in fraud losses.
Experianis launching a fintech-focused version of its fraud prevention data network, Hunter, in the U.S. The technology is currently being used by more than 450 organizations in 24 different countries. Experian reports that Hunter has saved its clients more than $6.5 billion a year in fraud losses.
Hunter works by providing participants with a “line of sight” into borrower activity across the fintech industry. A collaborative data network, Hunter enables participants to share data on fraudulent activity in real-time. That data is then securely linked across the network. Participants can use the network to identify potential fraud when onboarding new customers or when verifying current customers. Experian noted that its clients have seen a 35% increase in fraud detection when participating in a Hunter network.
“Our new U.S. Hunter network will harness the power of data and analytics to address real pain points that fintechs experience in combatting fraud,” President at Experian Decision Analytics in North America Robert Boxberger said. “By taking a collaborative approach, fintechs can use this additional data to make more informed decisions that enable smart portfolio growth, improve the customer experience, and mitigate major fraud losses.”
The Hunter network will be available in the U.S. later this year, the company said.
Experian made its Finovate debut in 2012 and most recently returned to the Finovate stage for FinovateFall 2018 in New York. The company’s Hunter announcement comes just weeks after Experian unveiled a new cloud-based fraud solution powered by adaptive machine learning called Aidrian. The new offering is designed to help businesses fight fraud without negatively impacting the customer experience. Last month, Clearcover Insurance Company announced that it had launched a new embedded insurance solution courtesy of a partnership with Experian. The technology gives insurance consumers final, bindable quotes when they shop using Experian’s auto insurance comparison shopping service.
Headquarted in Dublin, Ireland, Experian was founded in 1980. Brian Cassin is CEO.
Experian announced a partnership with Envestnet | Yodlee to help lenders in Australia take advantage of open data.
The collaboration will help Experian manifest its open data strategy in the country following its application to be an Accredited Data Recipient.
Both Experian and Envestnet | Yodlee have been Finovate alums since 2012 and 2016, respectively.
Information services company Experian has picked a partner as its official Open Data API provider in Australia. The company is teaming up with data aggregation and analytics platform Envestnet | Yodlee in an alliance that will allow Experian to access data under the Consumer Data Right (CDR) from data holders including Australia’s Big Four banks and more than 70 Australian FIs.
“Open Data solutions have the capability to solve two of the biggest challenges for Australian lenders: the accuracy of data to support responsible lending and streamlining the customer experience to get a faster decision,” General Manager of Experian Digital Simone Jemmett explained. “The more consumers that opt in to share data through Open Banking, the faster it will deliver the value it has in more mature data markets spurring innovation and greater competition among lenders,” Jemmett said.
The partnership news comes in the wake of Experian’s application to the Australian Competition ad Consumer Commission (ACCC) to become an Accredited Data Recipient under the CDR back in December. This is key step in becoming a part of Australia’s open banking ecosystem, and enabling Experian to focus on delivering fast and accurate affordability assessments. By leveraging Envestnet | Yodlee’s APIs, Experian will be able to help lenders shift to an emphasis on using Open Data sources rather than the traditional credit application process that requires manual uploads and data entry, as well as other inefficient practices.
“Lending is a valuable use case for Open Data with tangible benefits for lenders and borrowers,” Envestnet | Yodlee A/NZ Country Manager Tim Poskitt said. “With Experian coming into the CDR ecosystem, Australian Open Banking is reaching a tipping point and we’re ready for adoption to accelerate in 2023.”
A Finovate alum for more than a decade, Experian made its most recent appearance on the Finovate stage at FinovateFall in 2018. More recently, the company has partnered with fellow Finovate alum Zopa, which integrated Experian Boost into its credit-decisioning process. Experian began the year teaming up with decentralized and secured lending portfolio provider Credefi, and launching a new solution called CreditLock. This new feature enables customers to lock their Experian Credit Report to defend themselves against fraud and identity theft. “Our goal is to create products that help improve people’s financial wellbeing and give them more control over their finances,” Experian Head of Product Management Jayne Sankoh-Beacom said. “With this new feature we can now give our customers that extra layer of protection against identity fraud.”
Making its most recent Finovate appearance at FinovateFall 2021, Envestnet | Yodlee finished 2022 with news of a “deeper integration” between its Redi2 BillFin client billing solution and Schwab Advisor Services. This deeper integration gives advisors on Schwab’s platform who are using BillFin to access capabilities such as flexible billing setup and standardized templates, as well as reminders and alerts. “This deeper level of integration will allow even more data to seamlessly flow back and forth between the BillFin and Schwab platforms,” Envestnet Head of Billing Technology Fermin Garcia explained.
Financial inclusion has been a rising hot topic in the past few years. Providing underserved populations with the tools they need to manage their finances and build their wealth has been a top goal across many banks and fintechs, especially those focused on credit and underwriting.
I recently had the opportunity to speak with Gregory Wright, Executive Vice President and Chief Product Officer at Experian. Wright was a keynote speaker at this year’s FinovateFall event in New York. He offered key takeaways from his keynote, discussed opportunities for banks when it comes to financial inclusion, and talked about how they can prepare and plan to scale their operations.
Key takeaways from his keynote
I talked about innovation in three parts. The first part was about innovation with purpose. I think being mission-driven and wanting to have an impact in the world helps drive not only what you want to do as a business, it helps drive growth and [has an] impact on consumers and who you serve in the communities you live in. And that also can drive employee engagement; they love to work on something that actually has meaning beyond just making money.
The second part is innovation through scale. So, think about platforms. Think about global scale, how we leverage platforms and data, and cloud computing, and modern APIs so that you can innovate faster, get products to the market faster, and really have an impact not only for your business, but for your clients.
And in the third part, we talked about innovation with analytics. We live in this new world where cloud computing, advanced APIs, and modern APIs pull data from multiple data sources. [They are] able to do that in real time with advanced analytics and automating model deployment. We can bring together things that we’ve never been able to bring together before. That enables us to do analytics and credit scoring in ways we’ve never been able to do before.
On how banks and fintechs can leverage data and technology to drive financial inclusion
So, let’s just talk for a minute about conventional credit scoring. Today, the conventional credit scores can score about 81% of the U.S. population. That’s one-fifth that are not being scored or that are credit invisible. With ExperianLift, we can score between 93% to 96% of the U.S. population. That is a step change in performance. And that’s because we use more data, better analytics, bringing it all together in a big data platform and making it live instantly for consumers. So lenders, banks, fintechs– they need to be doing that every day to score more people, drive financial inclusion, and have better business outcomes.
How do we represent consumers in their time of need? There are one-to-two million credit reports pulled every day. These are the most important financial moments in consumers’ lives. We can help represent that. And I know fintechs want to create a consumer experience that is delightful, seamless, digital, easy. And with analytics and big data platforms, they can make that happen. We can help partner with fintechs to use things like Experian Lift, or, even better, Experian Boost, where we’re allowing consumers to come in, connect their bank account, add data to their credit report in real time based on the bills they pay, and improve their credit score before they even apply for something. We’ve worked with a lot of fintechs to figure out how we not only allow consumers to contribute to their credit report and get a better outcome, but also we can help them with better analytics and scores to score more consumers and get to a better outcome. This is not only good for consumers, because they get to a better financial outcome, it’s good for them. They’re scoring more people, getting to “yes” more often, and helping build their business.
What should companies implement now to prepare for future growth?
It comes down to what they’re trying to do and how they want to grow. I really advocate for innovating with purpose. [They should think] about how they want that consumer experience to feel and what that consumer journey is. How do they make it more digital, more seamless? How do they get to “yes” more often?
And again, we’ve talked about the platform capabilities from Experian that can help them. We’ve talked about how we can go from analytics and model development all the way to production through the Ascend platform. Things that normally take nine-to-twelve months to get a new score into market, into production, through compliance, and through their IT queue suddenly, we can do that in one platform from the analytics to deployment in real time. That’s something that any lender, any bank should be doing because it’s going to help get to “yes” faster, deploy better models in real time, pull data sources from not just the credit bureau but from anywhere. That means you can drive better customer outcomes, get to “yes” more often, not add more risk, and eventually build great businesses.
Experian announced a partnership with digital identity company Prove.
The partnership will integrate up to four Prove solutions into Experian’s digital identity and fraud risk mitigation platform, CrossCore.
Experian has been a Finovate alum since 2011. Earlier this month, the company announced a collaboration with U.K.-based NewDay.
A global partnership between information services company Experian and digital identity company Prove Identity is designed to help drive financial inclusion around the world via innovations in identity verification technology. The alliance, announced this week, will help companies bring their financial services to a wider range of customers, including members of un- and underbanked communities. The partnership will also enhance access to “faster, easier, and more secure experiences” for consumers.
As part of the deal, Prove will integrate a number of solutions into Experian’s digital identity and fraud risk mitigation platform, CrossCore. The specific integrations will vary by region, but include:
Prove Pre-Fill – enables auto-fill of application forms with verified data from authoritative sources
Prove Identity – validates consumer-provided personal identity information (PII)
Trust Score – provides a real-time assessment of phone number reputation for identity verification and authentication
Mobile Auth – provides real-time authentication of a consumer’s status on a mobile network
“At Prove, we believe that all consumers should have access to the digital economy, regardless of whether you already have a credit file or not,” Prove co-founder and Chief Executive Officer Rodger Desai said. “We’re proud to be partnering with Experian, which shares our vision for a more financially inclusive digital world. Together, we are giving more companies across the globe access to advanced identity technology, such as cryptographic authentication, that they can use to verify more consumers in a quick and secure manner.”
Prove specializes in verifying identities for members of un- and underbanked communities, many of whom have little or no traditional credit history. The company’s approach to verification leverages mobile phone-centric identity tokenization and passive cryptographic authentication to ensure security and privacy across digital channels while at the same time keeping friction low. More than 1,000 enterprises use Prove’s platform, processing 20 billion customer requests a year in industries ranging from banking and lending to crypto and payments.
“The rapid surge in demand for digital services and the growth of online accounts has accelerated the need for robust, real-time identity verification solutions with the broadest coverage and greatest inclusion,” Experian SVP of Global Identity & Fraud Marika Vilen said. “Integrating Prove’s industry-leading identity solutions with CrossCore and offering them as part of the CrossCore partner program strengthens our state-of-the-art cloud platform, identity verification, and fraud defense while also enabling our customers to verify more customers.”
A Finovate alum since 2011, Experian made its most recent Finovate appearance at FinovateFall in 2018. The company’s partnership announcement with Prove comes less than a week after Experian reported that it was working with U.K.-based unsecured credit provider NewDay. That partnership is geared toward helping Experian Boost customers access a broader array of credit options.
Be sure to join Experian next month for our webinar presentation, Digital Identity: Fintech’s Key to Unlocking Growth, featuring Chief Innovation Officer for Decision Analytics Kathleen Peters.
In today’s digital-first environment, fraud threats are growing in sophistication and scope, and risks of online and financial crime have intensified. At the same time, fintechs are prioritizing growth, and need to do so in a way that is safe, secure, and keeps bad actors out.
Watch back on this Finovate webinar, with Experian Chief Innovation Officer for Decision Analytics Kathleen Peters, as she explores the meaning of digital identity, and how fintechs can leverage identity-proofing strategies to position themselves for growth without diminishing security. Learn:
The role of digital identities in advancing increased personalization, speed, and growth responsibly in fintech and financial services
How data can aid in making smart, risk-based decisions across the user journey
How to unlock financial growth opportunities by offering solutions to previously unavailable consumers due to verification constraints
In a digital world, there’s no way around digital identity. The topic touches all corners of fintech and ecommerce, and while it can create a stumbling block, leveraging consumer identity data can also hold great opportunity.
We recently spoke with Experian’s Kathleen Peters for her thoughts on digital identity and how financial services companies can use consumer data to their advantage.
Peters started her career as an engineer at Motorola and later moved into voice and messaging encryption technology. Eventually, she began working in Experian’s global fraud and identity business and now serves as the company’s Chief Innovation Officer.
The fintech industry has always struggled with digital identity. Why is digital identity so difficult to get right?
Kathleen Peters: A consumer’s identity is personal; every interaction and transaction requires their identity. Consumers expect a seamless and frictionless experience, but also rely on organizations to protect their information. The balance is crucial and challenging.
As an industry, fintech is known for creating compelling and personalized online journeys. But that experience can suffer if the fraud-prevention routines are perceived as burdensome by consumers.
Every year, Experian conducts a survey of consumers and business leaders, asking them about sentiments, trends, and other matters around fraud and identity. Year after year, the number-one consumer concern is online security. When transacting online, people want to know that their information is safe and secure. In striking a balance with consumers to instill trust, industry players need to show some sign of security that reinforces privacy.
Putting this balance into practice, if a consumer or business is performing a large online transaction, they want to see added layers of identity verification. Conversely, if they are performing a simple online purchase, industry players should not over-index with heavy-duty identity resolution (e.g., facial recognition, passcode) on low-risk, low-dollar transactions. In short, we need the right fraud‑prevention treatment for the right transaction; it is not a one-size-fits-all exercise.
It is important to know a customer’s identity for compliance reasons, but are there business use cases for this as well?
Peters: When it comes to KYC (Know Your Customer) compliance, you want to verify that you are dealing with a real person (not a made-up entity) and ensure that you are not dealing with criminals or people on watch lists. This is a basic compliance check and mitigates the risk presented by increasingly resourceful “bad actors” who have become very sophisticated in how they find and exploit vulnerabilities.
For commercial entities, especially small businesses, you want to know that they are a real business. You want to know that the principals involved in the business (the owners, board members) are not criminals or people on watch lists, or that the company itself is not somehow engaged in things that you do not want to deal with. In this sense, KYC applies to consumers and businesses alike in terms of a compliance check. There is a different level of compliance for consumers versus businesses, but the KYC concepts remain similar.
With KYC, businesses can check the box that indicates that “I am compliant.” That does not necessarily grow a bank, fintech, or online merchant’s topline revenues. Compliance is certainly a core element of identity, but so is identifying a potentially fraudulent transaction. For example, recognizing synthetic identity scams can prevent an organization from losing hundreds, if not thousands, of dollars in fraud losses.
When the concept of personalization was introduced in fintech, there was a lot of discussion of privacy concerns and fears that consumers would perceive banks’ efforts as “creepy.” Does this still exist today?
Peters: Our annual Global Identity and Fraud Report shows that people hold banks in high regard. They possess an especially strong degree of trust from consumers. Yet, unknown fintechs that may reach consumers through a banner ad or other similar means may not yet possess that same amount of trust. Building trust with consumers is critical, especially for fintechs, and it starts with transparency and reinforcing the value exchange.
What is the best way for banks and fintechs to build trust among their consumers?
Peters: Banks and fintechs need a layered approach to identity resolution that accommodates the balance between fraud detection and the online experience to build consumer trust early in their relationship. Establishing that trust should be a top priority and involves having visible means of security, being transparent about why you are collecting certain types of data, and delivering value for that data exchange (e.g., personalized offers, speed). And that value needs to be immediate and a tangible benefit, not a down-the-road promotion or assurance.
According to our Global Identity and Fraud Report, consumers are willing to give more data if they trust the entity and feel as though they are receiving value.
Once the value exchange is established, those feelings of trust and recognition lead to increased brand loyalty, a holy grail for banks and fintechs.
Given this, what are ways banks and fintechs can leverage consumer data combined with an increase in their trust to better connect with consumers?
Peters: Building relationships with consumers comes down to recognizing them, protecting their information and offering a personalized experience. Consumers want to feel confident that their online accounts are secure, and that they don’t need to jump through hoops to access the resources they need.
It comes down to identifying and understanding consumers and their needs. The best way to do that is with a lot of data. It serves as a vast resource to look at the multitude of behaviors historically and predict the next likely behaviors and intent. Predictive modeling like this can be hard to do, especially if you do not have a lot of historical data. However, with aggregated data, scores, and solutions from a provider like Experian, it can be a very powerful way to drive engagement.
For instance, if a consumer is in-market for a new credit card, banks and fintechs may want to engage their consumers with a personalized offer or increase dollar-value transactions—both ways to build trust.
Experian has agreed to acquire a majority stake in Brazil-based MOVA Sociedade de Empréstimo entre Pessoas S.A. (MOVA) for $7.89 million (R$40 million).
Experian will take a 51% stake in MOVA today, with the option to acquire the remainder of the company between 2026 and 2028.
Experian is interested in P2P lender MOVA because it has the potential to enable Experian to help Brazilian companies assess the creditworthiness of their SME clients.
Information services company Experian will acquire a 51% stake in Brazil-based MOVA Sociedade de Empréstimo entre Pessoas S.A. (MOVA) for $7.89 million (R$40 million).
Headquartered in Sao Paulo, Brazil, MOVA is a peer-to-peer lending platform that seeks to offer borrowers an alternative to traditional bank loans. The company also offers a range B2B tools, including a credit-assessment-as-a-service product to offer automate credit decisioning, a service to help companies register a credit request, anti-fraud tools, and more.
Experian’s interest in MOVA stems from this ability to help Brazilian companies assess the creditworthiness of their SME clients. “SMEs are underserved by affordable credit in Brazil and MOVA is tackling this issue,” Experian said in an announcement.
A full acquisition is still on the table. Experian has a call option to acquire the remaining 49% stake in MOVA between 2026 and 2028. In 2029, the deal reverts to a put option for MOVA.
Founded in 1980 and headquartered in Ireland, Experian offers a range of services for small businesses, including business credit reporting, marketing products and services, debt collection tools, and more. On the consumer-facing side, Experian offers credit reports and scores, identity theft protection, and a marketplace to compare credit card, loan, and insurance offers.
Zilch is partnering with Experian to update its Buy Now, Pay Later affordability criteria.
Experian and Zilch will share reporting of payment plan data, which will provide a more complete picture of consumer finances when applying for BNPL financing.
The collaboration comes as many observers have begun to worry about the potential hazards that BNPL could represent for consumers.
At a time of growing scrutiny over the Buy Now, Pay Later e-commerce craze, companies like Zilch are taking the extra step to ensure that consumers using its BNPL service are not getting over their heads when taking advantage of the latest consumer financing option.
This week, Zilch announced that it has partnered with Experian in a reciprocal credit data reporting collaboration that will offer a holistic, 360 degree view of a consumer’s affordability at a given point in time. The data exchange plan takes place under the auspices of the U.K.’s Credit Reporting Act (CRA), which manages rules regarding the supply of products, services, and digital content in the B2C sector. In a statement, Zilch noted that adding Experian’s reporting of payment plans, along with CRA and open banking data, and its own proprietary behavioral statistics, will enable the company to better assess the affordability of its two million customers.
“Zilch was built with financial health at its core, which is why we were one of the first BNPL to work with the FCCA to secure a consumer credit license,” Zilch co-founder and CEO Philip Belamant said. “Today, by partnering with Experian, we are continuing to transform the way affordability is assessed which is the key to us delivering financial inclusion to all.”
Consumers using Zilch pay 25% of their purchase upfront at checkout, then pay the rest of the balance for their purchase in three installments two, four, and six weeks later. Zero interest is charged, and Zilch offers a 2% cashback reward for consumers using Zilch who pay for their purchase in full on the first payment (“Pay in 1”). Rewards can be used to discount future purchases or saved to be spent later on a full purchase.
Zilch was founded in 2018. Last month, the company announced that it surpassed the two million customer milestone. A double unicorn with a valuation of more than $2 billion, London-based Zilch entered the U.S. market late last year and, shortly afterward, announced the launch of its gift card solution, Gift Cards by Zilch. The company has raised more than $339 million in funding, according to Crunchbase.
When it comes to financial inclusion, it’s easy for some people to turn a blind eye. However, when banks and fintechs help to solve gaps in the current environment, there’s more potential to boost everyone’s financial health.
Lloyd Pitchford, CFO at Experian, is working on promoting financial inclusion via Experian’s Environmental Social and Governance (ESG) program, which helps Experian improve its performance across ESG matters, including supporting financial inclusion and financial health.
We spoke to Pitchford about the program and his view of the current financial inclusion environment and how the industry should respond.
How have you seen financial inclusion awareness evolve into what it is today? What has prompted the increased awareness?
Lloyd Pitchford: The United Nations includes access to financial services, such as credit and microfinance, among its Sustainable Development Goals. Access to affordable credit opens the door to opportunities for people to transform their lives – from homes and healthcare to education and entrepreneurship. This has never been more important than it is today, following the global pandemic.
There are times in most of our lives where we can’t get access to the financial system in a way that we want, be it for a mortgage, a car, or a business loan. We’ve all experienced the frustration when you feel you’re on the outside of the system and you can’t do the things you want for yourself or your family. At Experian, it’s our job to change that. We want to make sure everybody is included and has access to fair and affordable financial products. Financial inclusion is fundamental to our business.
When it comes to financial inclusion, what are some of Experian’s offerings you are most proud of?
Pitchford: As the pandemic took hold in 2020, we stepped in with data and analytics to support governments, health services and national emergency response efforts. Our data and analytics helped them plan ahead and direct health care and financial support to the most vulnerable people through major initiatives such as COVID Radar in Brazil and Experian CORE (COVID Outlook & Response Evaluator) in the USA.
It soon became clear that the impact, not just on physical health, but on financial health, would be far-reaching for people around the world. We looked at how we could mobilize our expertise and resources to help communities through the crisis and focused on financial education as the best way to strengthen their resilience and support their road to recovery.
Through the launch of our United for Financial Health programm we rapidly established 11 NGO partnerships across our biggest consumer markets to deliver targeted financial education for some of the communities hit hardest by COVID-19. By the end of the year, we had reached nearly 35 million people, more than double our original goal of 15 million, and we’re not stopping there. We aim to reach 100 million people by 2024.
Part of our efforts include our member relationships around the world. This year, we surpassed the milestone of 100 million direct relationships with consumers globally and delivered further innovations to support people through our business, such as the launch of products like Experian Boost in the UK and Serasa Score Turbo in Brazil. This, of course, is on top of our ground-breaking Experian Boost launch in the United States a few years ago. Our goal is to have a direct relationship with as many people as possible; to truly become the Consumers’ Credit Bureau and power financial opportunities for all.
What advice would you give other incumbents who are trying to drive financial inclusion within their organizations?
Pitchford: I would point to our culture of innovation. It helps us harness opportunities to drive business growth. We are continually investing in product innovation and new sources of data to address emerging market opportunities that can make a real difference to global communities. In 2020, around 1,000 innovators from across Experian joined our annual Future of Information Conference – which was held virtually because of the pandemic – to encourage them to think differently in their work. Topics included fairness in artificial intelligence, transforming agribusiness, and enhancing the consumer healthcare experience. Teams at our DataLabs in Brazil, Singapore, the U.K. and the U.S.A. tap into our culture of innovation to continually create new solutions to global challenges. The result of all this is that our Social Innovation products have now reached 61 million people since 2013. We aim to reach 100 million by 2025.
What challenges exist in serving underbanked communities as an incumbent? Would it be easier as a startup?
Pitchford: Our annual Sustainable Business Report notes that more than a billion people in Asia Pacific lack access to formal financial services, 45 million in the U.S.A. have no credit profile or are unscoreable, 45 million in Brazil are unbanked, and over five million in the U.K. have no credit history. So we know we’ve got more work to do and we remain focused on using our business to make real and sustainable change. With social innovation running so deeply through the core of our culture, and our commitment to improving global financial health front and center of our thinking, we will continue to push to find new solutions to help people, serve communities and protect the environment, helping to create a better future for all.
After the world went digital last year, the digital identity crisis began taking on new life. Most fintech players are involved in digital identity in some way, and Experian is no exception.
We recently spoke with Eric Haller, Experian’s Executive Vice President and General Manager of Identity, Fraud & DataLabs, to get an idea of how digital identity is changing.
In the interview below, Haller offers his expert opinion and shares how enabling technologies such as AI and the blockchain are impacting how firms think about digital identity.
Digital identity has been on the radar of financial services firms since the dawn of online services. How has this past year of digital acceleration changed how firms approach digital identity?
Eric Haller: The pandemic has shifted segments of the population to the web that weren’t as engaged online as they were prior to the pandemic. For this segment, shopping “face to face” felt safer in many ways. But with a biological threat surfacing, the risks of shopping in the physical world traded places for online risks. All of a sudden, online services seemed much safer.
This plays out in our research where we saw a 20% increase in online shopping this past year with 43% of consumers believing they will even increase their online activity over the next year. And with this shift, 55% of consumers say security is their top priority in a digital experience.
Tell us about the role that AI plays in enhancing digital identity verification for banks.
Haller: To validate someone’s digital identity, literally hundreds of data elements are evaluated to assess whether an individual is a bot, an imposter or the person they claim to be. And all this data is collected, analyzed, and acted on in milliseconds. AI allows for these complicated links and behaviors to be tied together in a variety of ways quickly, efficiently, and accurately to assign the correct conclusion to each customer.
If everything goes well for a legitimate customer, the experience is smooth sailing and both the consumer and merchant conduct “fraud free” business. Most often, there is no fraud. It only happens a very small percentage of the time. But it’s important that if it is a bot or an imposter, that the models in place are precise.
The blockchain seems like a valuable enabling technology when it comes to proving identity. Is this an idea you’ve seen gain popularity? Or is it more of just a fad?
Haller: The portability of a trusted identity in a digital ecosystem integrated with a blockchain could serve a lot of value for consumers and businesses. But it requires quite a bit of effort to get both those that want to share their identity and those willing to invest in accepting it participating in it.
If there were a lot of businesses that would accept a particular blockchain based ID, consumers would put in the effort to have on and use it. If there were a lot of consumers with it, businesses would put in the effort to invest and accept it.
Which side grows with scale first? There are many chasing this ideal. I wouldn’t characterize it as a fad — just very ambitious and challenging to achieve.
AI marketing expert Micronotes recently launched a refinancing tool that will help consumers reorganize their debt, while enabling banks to lower their borrowing costs and boost customer retention.
The new tool builds on Micronotes’ ReFi solution it launched last June. The credit marketing automation suite enables banks to leverage AI to help their clients automatically identify refinancing opportunities for a range of consumer debt, including auto loans, personal loans, student loans, credit card debt, and mortgages.
With today’s advancement of ReFi, Micronotes is teaming up with Experian to leverage the firm’s database of consumer credit profiles. Experian will compare the bank’s current lending criteria to the consumer’s credit profile, and then synthetically refinance the customer’s existing debt held elsewhere while identifying other refinancing opportunities.
“We’re thrilled to partner with Experian to leverage artificial intelligence and data to help consumers lower their borrowing costs,” said Devon Kinkead, founder and CEO of Micronotes. “With an estimated $2 trillion in mispriced debt, during an era of persistently low interest rates, we help digital banking customers see where they’re overpaying interest that can be refinanced with a lender they know and trust — their primary financial institution.”
Micronotes’ personalization expertise comes in via the customer communication piece. The company will send the customer a message in the digital banking channel that informs them of the potential savings. Using Micronotes’ technology, the customer can respond to the message using preset, customizable quick-response buttons that range from “remind me later” to “chat with a banker.”
This quick-response messaging system is Micronotes’ bread and butter. The company was founded in 2008 to help financial institutions start conversations with their customers in a non-invasive way. At the company’s most recent Finovate appearance, FinovateSpring 2013, Micronotes showed off its cross-sell feature that uses predictive analytics to bring the branch sales process into the digital channel.
Headquartered in Boston, Massachusetts, Micronotes has raised $12.2 million.
