![]() One of the key technologies financial institutions are adopting is artificial intelligence.ĪI helps in the development and adoption of new credit score models. Technology is ushering in new ways to vet loan applicants. Traditional approaches such as the FICO credit scoring are quite limited when it comes to showing an applicant’s creditworthiness. These include freelancers, students, low-income households, and many others. Rather than focusing on high credit-worthy consumers, the future of the lending market is influenced by the need to involve potential customers with a low credit history. This makes fintech consumer lending more inclusive. The combination of these factors has influenced an era where consumer insights are blended with product innovations. The necessity to simplify the existing processes.Mainly, four factors are driving the digitalization of consumer financial services. ![]() New technologies are disrupting every industry, and the lending industry is no exception. How is technology changing the lending market? Relevant case study: A custom mortgage solution for the UK fintech company.Top 5 credit scoring software platforms.What should you consider when building a credit score solution?.Credit scoring software solution: How to build one?.Machine learning and credit scoring: How does it fit-in.How fintech companies implement alternative credit scoring.What are the advantages of alternative credit scoring?.What is traditional credit scoring, and why is it not effective?.How is technology changing the lending market?.The unprecedented growth in the use of mobile phones globally is one of the primary driving forces in the evolution of alternative financing. McKinsey Global Institute (MGI) found that the widespread use of alternative digital financing could boost the annual GDP in developing economies to about $3.7 trillion by 2025. Alternative credit scoring uses digital software to assess the applicant’s creditworthiness. Over the past few years, credit scoring software has garnered mainstream appeal from both financial institutions and borrowers. Popularly known as alternative credit scoring, these methods enable lenders to qualify for a loan even without a good traditional credit score. To quicken the process and expand loan disbursement, technological advancements in Fintech are reshaping the lending landscape, bringing in new ways to help borrowers easily access loans. Instead of relying on the limited and standard traditional credit score, many banks and financial institutions are now using credit scoring software to measure qualitative and quantitative risk factors before financing individuals and SMEs. Before approving a loan, any savvy lender must take an in-depth look at a borrower’s financial history.
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