Belvo has developed Recurring expenses: a new data enrichment product that allows financial innovators to automatically identify consumers’ recurrent expenses for subscription services.
We work hard to keep building the most powerful and complete set of tools to extract maximum value from financial data thanks to our open banking APIs. Our data science team has now developed a new enrichment solution, Recurring expenses, which provides an instant picture of users’ monthly recurring expenses with a particular focus on subscriptions.
The usage of services like Netflix, Amazon Prime, or Spotify has increased steadily in the last few years, as part of what’s already called the subscription economy, which has grown by over 350% since 2012. These services, alongside things like gym memberships or online content subscriptions, increasingly represent a stable percentage of people’s monthly expenses.
Now, you can use Belvo API to get an instant picture of what users are spending on this type of service, analyze the impact it can have on their financial wellbeing, as well as provide them with more personalized insights on how to improve it.
With this new product, we reinforce and expand our enrichment solutions offering: combined with our product Income verification, financial innovators can now have an even more granular view of their users’ financial health and stability.
Automatically identify recurrent expenses
The main goal of this new product is to provide greater insights into users’ most common spending habits on subscription services (like Netflix, the gym, or Amazon Prime), frequent utility payments (like internet or electricity), as well as other cyclical payments they might make (such as loan repayments and common transfers to friends).
Using these data points, companies can easily and quickly assess their customers’ repayment risk as well as offer them advice on how to improve their financial health.
Recurrent expenses can be defined as payments that take place on a regular basis (weekly, monthly, or annually) and are periodical transactions of a household or an individual.
The solution is available in all our markets and, for now, it covers data coming from checking and credit card accounts (new features will be coming soon!).
How does it work?
The new solution uses Belvo’s API to extract financial information from the +50 top retail banks in Latin America (which represents more than 90% of market coverage). Then, our data science model processes this raw information to accurately identify the recurring transactions and display them in a format that’s easy to interpret and ready to use.
By leveraging the data retrieved from accounts, transactions, and transactions’ frequency, our model allows companies to instantly get clear insights into their user’s regular payments in a few simple steps:
- Connect: users connect their financial data using Belvo’s widget and a link is created.
- Enrich: Belvo aggregates and enriches their financial data every time you request an update.
- Access: we return full information about your customers’ recurring outflows.
The logic behind it is to group expenses transactions based on similarity and filter out transactions that don’t take place on a recurring basis. We take care of automating the full process of extracting recurring outflows so that companies are able to retrieve the data they need without effort.
By accessing enriched data about subscriptions and recurrent payments companies can easily discover clear patterns and habits and better understand their end-users financial situation. This can help companies to develop new tailored solutions such as creating alerts for monthly subscriptions as well as making more informed decisions when assessing lending risk.
Build smarter money management apps
Having access to enriched and categorized information about your customers’ spending patterns is key if you’re building a personal finance management app (PFM). Our API platform already helps many PFM companies to easily calculate their overall financial situation, provide them with more personalized insights and create tailored-made financial products.
Combined with our Recurring Expenses API, you can translate your customers’ raw, unstructured transactional data into actionable items that are ready to be displayed and fed into your app. For example, you can use this information to create an alert for your users’ monthly subscriptions, help them reduce the “small expenses” that can affect their financial health, as well as help them group all their subscriptions in the same place.
Make more informed credit decisions
Credit providers can also benefit from access to real-time and enriched financial data to improve credit scoring and underwriting models. By identifying your user’s regular payments for subscription services, you can get a comprehensive view of their financial status, understand their recurring expenses, and analyze their distribution over time in order to build tailored lending experiences while reducing risk and manual workload.
Check out our new product, as well as our developers portal to find detailed information about this product, which is already available in our sandbox environment. You can also find our Postman collection here.
We’re really excited to hear your feedback about it!