The partnership is the first time Open Banking has been used in this way between a credit marketplace and a credit card provider. 37% of those who have signed up so far would not have qualified for a Zopa credit card using traditional credit decisioning methods.
ClearScore, the UK’s leading free credit score and credit marketplace, today announces its very first Open Banking integration with neobank Zopa. This represents a first-in-market Open Banking integration between a credit marketplace and credit partner, designed to give access to credit products for people who need them most but who would likely be declined based purely on what is displayed on their credit report.
By combining data held by ClearScore and Zopa’s real-time Open Banking capabilities, users can find out immediately if they will be pre-approved for a Zopa credit card with a guaranteed personalised APR, providing certainty without marking their credit file. With access to real-time, relevant financial information via Open Banking technology, ClearScore users who may have previously been declined for credit products can now gain access to a Zopa pre-approved credit card as a decision has been made using a wider view of their individual finances and creditworthiness.
The events of 2020 have accelerated the need for Open Banking and highlighted why it’s so important to consumers and lenders moving forward. Changes to consumer’s financial situations were significant in the last year with government schemes such as furlough, redundancies, changes to income and personal circumstances, all shifting at a rate that outpaced changes to credit reporting, meaning traditional, credit-report-based decisioning processes alone may not give a true picture of someone’s financial situation. This left many users who were able to make repayments, without access to the right level of credit.
ClearScore’s partnership with Zopa gives many of its 11 million users the opportunity for their individual financial circumstances to be viewed with complete clarity and for lenders like Zopa to make credit decisioning based on a real-time view of the customer’s wider financial situation.
ClearScore is rapidly accelerating the use of Open Banking among its 11 million UK users by demonstrating the value Open Banking will bring them in the form of improved access to credit products and more certainty when applying. Over 200,000 ClearScore users have already linked their data to Open Banking, with 70% of users taking under three minutes to successfully link their accounts through a mobile device. Zopa is the first credit card partner to go live with Open Banking data on the ClearScore marketplace, joining several partners in the unsecured loans space who already leverage this data in their underwriting decisions.
Having initially rolled out the partnership with ClearScore at the end of April 2021, Zopa has seen a 37% increase in the number of applicants who are now eligible to apply for a Zopa credit card. Within one week of the test beginning, more than 43,000 ClearScore users have seen a Zopa offer which would not have been available based on credit report data alone. As a top 10 credit card issuer in the UK in terms of new customers originated, Zopa is now able to responsibly offer even more consumers access to its credit card at this crucial point in time.
Andy Sleigh COO of ClearScore, comments: “Throughout the pandemic, we have seen a dramatic drop in access to credit with lenders hesitant to offer credit to people at a time of financial uncertainty and turmoil. We are excited to be partnering with Zopa, who are able to highlight the tangible benefits of Open Banking technology, unlocking credit for those who previously wouldn’t have had access to this due to having a lower credit score or mark on their report.
“At ClearScore we are passionate about making sure we can offer our customers the right options for their financial needs based on enhanced data solutions, which is why we work very closely with our partners to ensure this. We provide lenders with a range of data that allows them a more in-depth view of a customer’s credit history and using sophisticated tech integrations such as Open Banking they are able to provide more personalised and tailored offers. We are only scratching the surface of the benefits of Open Banking and so it’s great to see more innovative companies like Zopa showing its potential.”
Tim Waterman, CCO of Zopa, says: “At Zopa, we’ve used Open Banking technology since its inception to improve the customer experience, and now we’re using it to responsibly provide credit to people that previously may have been locked out of our products. We’re at a crucial point in time where Open Banking provides an opportunity to responsibly offer products to those that need them most and who are more than eligible for credit but are currently penalised due to the financial impact of the pandemic. Our credit card has been completely built around the consumer, with the end result being that through Zopa’s product customers are better placed to manage their finances moving forward.
“Zopa’s partnership with ClearScore has allowed us to be able to offer our card to their huge customer base via our Open Banking technology, which provides us with a more holistic view of consumers’ finances. We’re proud to be the first credit card provider to partner with ClearScore in this way, helping more people across the UK gain access to the credit they need and a Zopa product that will contribute to improving their financial wellbeing in the long term.”
ClearScore is the UK’s number one free credit score and financial product marketplace. Founded in 2015 with the mission to help users take control of their financial health, ClearScore is the industry leader in giving everybody access to their credit score and report for free, forever. Winners of prestigious awards such as the Queen’s Award for Enterprise and featuring on The Sunday Times Best Companies to Work For list, ClearScore combines a team of industry experts, sophisticated algorithms, and clever tech with a trustworthy brand. The result is a beautiful product that delivers an experience that is clear, calm, and easy to understand. ClearScore uses data every step of the way to ensure that users see the most relevant financial products for them, giving them the tools to manage their finances in a way that suits them. With over 11 million UK users, and a further 2.3 million worldwide, ClearScore constantly innovates to help their users on a journey to greater financial wellbeing. Co-founded by CEO, Justin Basini, ClearScore is based in London and is supported by investment from QED Investors, Blenheim Chalcot, and Lead Edge Capital.
Launched in 2005, Zopa pioneered peer-to-peer lending globally and has now launched a digital bank. In June 2020, Zopa was awarded its full banking licence. As it launches its next generation bank, Zopa’s ambition is to make even more people feel good about money, providing simple, fair products that are easy to manage and using its tech know-how to provide a bank that’s fit for the future. In less than six months, Zopa fully launched its Fixed Term Savings accounts and a credit card.
Over the last 15 years, Zopa has provided loans and investments products as a peer-to-peer lender. It has helped half a million customers get the most from their money and approved over £5bn in personal loans. In that time, it’s been named Moneynet’s Online Savings Provider for 2021, voted the British Bank Awards’ Best Personal Loan Provider four years in a row and was Moneyfacts’ Personal Loan Provider of the Year for 2020 – the sixth time it’s won the award.
Zopa Bank Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Zopa Limited is authorised and regulated by the Financial Conduct Authority.
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