BankTechFintechServicing Solutions

Finicity, LoanPro partner to battle lending fraud with open banking

Software-as-a-service (SaaS) startup LoanPro announced Tuesday a partnership with Mastercard‘s open banking solution provider, Finicity, aimed at mitigating fraud for both consumers and loan servicers.

According to a release, LoanPro will utilize consumer-permissioned data and analytics from FinicityPay solutions to better verify account ownership, fund loans and dull payment inaccuracies. Founded in 2016, LoanPro’s platform is hosted on Amazon Web Services (AWS) “the cloud” and is designed to streamline both loan servicing and loan collections workflows

“The COVID-19 pandemic has increased consumers’ adoption of digital payments, and as a result, financial institutions have witnessed an increased demand for digital loan repayment solutions,” said Richard Kuhn, Finicity’s SVP of Business Development.

Kuhn noted access to consumer-permissioned data from an open banking network can and should improve payment success and mitigate failure and fraud.

Massive acquisitions like Visa‘s takeover of Sweden’s Tink and Mastercard‘s procurement of Danish tech firm Aiia highlight the competition and opportunity that open banking has witnessed in recent years. For fintechs, FIs and their customers, open banking has been cited as a safe and less vulnerable option to controversial screen scraping.

The Biden administration issued an executive order in July 9 that encouraged the Consumer Financial Protection Bureau (CFPB) to create rules that make it easier for consumers to transfer bank account data across financial institutions – and it’s that access to data transfer that will be a fundamental player for open banking’s adoption.

Competition abound, Finicity has hosted a number of partnerships this year for open banking solutions including an August integration with ICE Mortgage Technology that allows borrowers to permission data so that lenders can quickly verify assets, income and employment. It had also previously worked with large financial institutions Brex, a fintech that offers business credit cards and cash management accounts to tech companies, and Charles Schwab, one of the largest wealth management firms in the nation.

“We are pleased to be working with the top-quality team and brand of Finicity,” Rhett Roberts, LoanPro’s CEO and co-founder of LoanPro. “Their products are an excellent complement to LoanPro in providing a complete solution to our customers. Our focus is to provide the most robust and quality user experience in the world for loan servicing, and this partnership helps to move that initiative forward.”

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