Belvo’s new tool estimates the ROI of implementing Open Finance to reassess the credit of users declined by the lender’s current funnel
Open Finance technologies can benefit different parts of the credit process, from using data to better evaluate credit risk to adopting open finance payment technologies to streamline lending collection.
Now, lenders have access to Belvo’s ROI Calculator, a tool that helps them estimate the return on investment of one of the most exciting use cases of the technology: using open finance data to offer credit lines to users that have been rejected in the traditional funnel and therefore have not received a loan offer.
With Open Finance data, it is possible to reengage this customer and increase offers thanks to a more comprehensive credit profile evaluation.
In a real use case examined by Belvo, a financial institution obtained a 16% increase in the number of previously rejected customers who were approved for a credit line after a new offer based on open finance data (including those with negative credit ratings at credit agencies).
Assuming the company’s target audience for its campaign was one million users, this means it could grant 45,000 new loans to customers who were originally rejected, allowing the company to recover those lost opportunities and give a second chance to users.
How to calculate the ROI of Open Finance for lending?
The numbers shown in Belvo’s ROI calculator are the result of the analysis done in thousands of credit assessments which, together with the lender’s inputs, can show the approximation of the returns.
To access the estimates in real time, the lender simply needs to input some of its current metrics into our ROI Calculator, such as the present percentage of credit approvals and annual average profit margin per loan.
The lender will then have an estimate of the additional approvals per year it can reach after implementing Open Finance, as well as the extra income and cost approximation.
The results shown in the calculator are estimates. Reach out to our team to analyze your funnel and assess the extra income, costs and return.
