A mortgage team can identify applicant incomes instantly and reliably, allowing better and faster underwriting, with significant time and cost savings. A customer management team can instantly identify customers showing signs of vulnerability, allowing them to offer support well before arrears and collections. These are some of the benefits lenders can experience with income insights.
Cutting through income complexity
For lenders, knowing how much a customer earns is more important – but also more complex – than ever before.
Loan applications, risk modelling, fraud checks, identifying and supporting vulnerable customers early – all these and much more depend on knowing a customer’s source and amount of income – regular and irregular. However, this is becoming harder to work out.
Decades ago, it was straightforward – usually one stable, regular salary or set of wages hit an account each week, fortnight, or month. Now customers with multiple employers, employment combined with self-employment, short-term contracts and gig work, property income, and often changing employers, are much more common. So an individual’s income picture is now usually much more complex and personalised.
Allied to this is the current cost of living crisis, therefore the need to accurately assess an individual’s income is more pressing than ever before, both when applying for credit, but also monitoring repayment of credit.
Income insights can help cut through the intricacy with a transaction categorisation service taking some complexity out of identifying and quantifying income.
Big benefits for lenders
After enriching transaction data, we use it to give lenders a clear and enhanced view of the data, allowing lenders to understand the following:
- The source of income(s)
- The cadence of payments from that source
- The median amount paid
- First and last payment dates
We can provide this for 10 different categories of income and 26 types of government payments/benefits. These insights can also be used across your own data to identify portfolio trends.
This ability to switch from taking a portfolio view to examining one account gives lenders important benefits:
- New customer acquisition / originations – Automate the income identification process, rather than having to rely on user input, saving time and significant costs. For higher value credit products such as home loans and personal loans this is particularly important.
- Risk modelling – Help risk managers identify key trends across portfolios and anticipate emerging risks.
- Fraud prevention – Find patterns and irregularities in income to improve fraud identification models.
- Customer management – Use a range of key metrics to identify vulnerable customers and support them before financial stress hits.
In all of these cases, income insights can provide more in-depth, detailed complementary insights to other data sources, helping lenders to have more personalised, profitable and risk-controlled interactions with customers throughout their relationship.
To learn more about how we can help, please get in touch with us using the form below.