The Belvo Open Finance Score, powered by FICO, will help lenders make more accurate and inclusive risk assessments.
FICO, a global analytic software company and recognized leader in AI decisioning platforms, and Belvo, the leading open finance data and payments platform in Latin America, today announced a strategic partnership aimed at expanding credit access in Latin America.
The two firms are developing an interpretable and explainable machine learning model that will provide a score based on consumer-permissioned transaction-level data, aimed at increasing credit access for consumers, improving banks’ risk management, and empowering lenders to create personalized financial experiences for their customers. It was announced today at the Febraban Tech Conference in São Paulo that the score is expected to be available in Brazil later this year.
The Belvo Open Finance Score, which is developed by FICO’s AI Innovation and Development team using AI techniques such as interpretable neural networks, will produce a credit risk score based on open finance transactions from a multitude of financial accounts (credit, debit, current accounts, savings, investment, etc.) – permissioned by the customer and securely processed through Belvo’s open finance infrastructure. By incorporating data from additional sources, the score will provide an analytical tool for financial institutions that will enhance their use of existing credit bureau scores and internal models. It can also help companies that don’t have a mature analytics infrastructure to make better credit decisions.
“The speed of change in consumers’ behavior since the pandemic is astonishing, and we have an opportunity to bring new insights to lending decisions,” said Albert Morales, Belvo’s General Manager in Brazil.
“Open finance data provides a much wider and updated picture of the circumstances of people and companies. Together with FICO, we are capturing the predictive value from all this data and summarizing it in a score that will help financial institutions make more accurate risk assessments and identify creditworthy people they may be missing today.”Albert Morales, Belvo’s General Manager in Brazil
“Open finance data has the potential to be a major component of a country’s financial and economic ecosystem, as seen in Europe,” said Alexandre Graff, FICO’s senior vice president of Global Partnerships and Alliances. “The solution we are developing with Belvo can be a game-changer for increased financial inclusion, and advances FICO’s mission to help more people get access to credit, as expressed in our Global Financial Inclusion Initiative.”