All language subtitles for transcriot ep 30 english

I think finding new sources of data
that are reliable, a comprehensive,

that's a timely, that's key to this.

And that's why we're making such
an investment in open banking.

Why we've recently started taking a
mental data and why we're engaging

now with buy now pay later players who
are starting to contribute that data

into the bureau, but I'm sure that
will be a very rich source of data.

Welcome to how to lend money to strangers.

I'm your host, Brendan LaGrange.

And yes, I'm sick and croaky.

Again.

I have been working in consumer
lending for the last 20 years

first with credit card and personal
loan issuers across Africa.

Then as a consultant in the
Nordic, Southeast Asia and the UK.

And now as the chief solution architect
of confirm you FinTech gamifying

access to credit among the unbanked.

Check out our story in episode 24.

But prior to this role, I was
doing industry level research for

one of the big credit bureaus.

And one of my defining projects,
there was a deep dive into the

true value generated by consumers
monitoring their own credit reports.

Prior to my study, I'd only
seen this address as a single

question, do consumers who monitor
their own credit data regularly.

See improving credit score.

Now, if you were only going to pick
one metric to track, that would be

the one that the fact is consumers can
monitor their credit for many reasons.

And those varying reasons can
dilute the observable benefit.

If you only look at the change in score
for every consumer, trying to keep

their credit in check, there might be
one who's just gathering the paperwork.

They need to finalize an
unavoidable bankruptcy.

There may be one looking for
a new mortgage or a new auto

loan or a new credit card.

Or just making sure there's no fraudulent
use of their identity, all activities

that don't need the score to improve, to
have helped the consumer meet their goals.

So in other words, consumer self
monitoring is a complex and dynamic

space and that was four years ago.

So much has changed since which we'll hear
all about from today's guests, TransUnion.

UKs Kelly fielding.

Hi, Kelly.

And welcome to the show.

you are the managing director for consumer
interactive at TransUnion in the UK, and

that's a function that used to just be
about making it possible for consumers

to get a copy of their own credit report.

But after the last decade or so,
it's grown into something much,

much bigger that starts our chat
today, by expanding on that.

Who are you and what does consumer
interactive mean in the context of

TransUnion and the general context
of the modern credit bureau?

Well, as she said, I lead the consumer
attractive business at TransUnion

here in the UK, TransUnion as a
global information and insights.

This.

And the part of the tie run helps
consumers better manage their finances.

So that's either directly or via partners.

We provide consumers with access to
their credit report, their score, and a

suite of education tools and educational
content so that they can better

understand their financial position,
make smarter financial decisions.

I've worked in the industry for 20
something years now, starting a business

called core credit, which was acquired
about three years ago by TransUnion.

And as you said, we started out
just providing the status reports.

Unlike the other bureaus, we also
had a subscription service where

consumers would pay something like 15
pounds a month to access that report.

But in around 2013, we did something
that was pretty disruptive in the market.

We launched the first free
service, which was called.

And that's allowed consumers
to access the report, the score

get alerts when he changes and
correct any errors on that report.

And that's really important correcting
errors to make sure it's all accurate.

They could do that all before.

And then when TransUnion acquired the
business, we made the strategic decision

to divest of novel, to credit karma.

They run a great website now for
consumers to access their data for free.

And now my team is solely focused on
helping our partners to use our services,

to build trust and empower that.

More recently we've expanded
the consumer attractive family.

If you like further through our investment
and under strategic partnership with and

Benito is a personal credit platform
that connects consumers, it was searching

through price comparison sites, connects
those consumers with products that

suit their individual circumstances.

So we can now allow consumers to
understand their score, to improve

it, and then be presented with cards
and loans that they are eligible.

I sit on the board about business
as non-exec director, and I'm really

excited about what we can achieve when
we bring both of those businesses to get.

I've been working in consumer credit
for over a decade thing before I

first heard about it being possible
to check your own credit report and

a few years more before I realized
that might be useful for anything more

than checking on some clerical errors.

So for those who might be similarly
out of the loop, what are the

benefits the consumer would
get from checking their credit?

I mean, I guess it's a little bit like a
doctor, you know, wanting to go to for a

physical exam, you know, you should do it,
but it feels a little bit uncomfortable.

You know, you can feel a
little bit judged at times.

What would a consumer get out of
taking that first step and looking

at their data and setting that up?

So quite like going to the doctors,
consumers should think of their

credit report and score as a financial
health check or a financial passport.

It plays a really important part in life.

And that can be from
enabling everyday purchases.

They forgetting mobile phone contract
or holiday through to buying a

car or logging your first home.

You know, your credit score report
helps lenders decide whether

or not to offer you credit.

And at what rate.

Regularly checking your credit report
can also help you ensure that the

information, how this correct, which
is really important to making sure that

when you're coming to make an application
that got the right opportunity to do so

equally, it's not just about finance.

Your credit report can help
you monitor for identity fraud.

It might be one of the first places you
can spot any potential signs of someone

trying to use your identity and a scam.

This is more important than ever.

Our recent figures are showing
that third of our consumers have

been targeted with digital fraud
attendants during the pandemic.

Yeah, I think it's a great point to call
out because I feel like there's a bit

of a messaging gap where most of the
stories you hear talk about strategies to

optimize your credit score, and they talk
about it in the context of getting that

next credit card, getting that next loan
and for an international audience, I can

maybe feel a little bit of an American.

As, I mean, that might not matter as much
in a country like the UK where people only

have one credit card on average, maybe
1.1 credit cards yet they're not looking

for five credit cards in their wallet
and they can see those strategies and

think, well, maybe it doesn't apply to me.

But even if you're in a market with
less consumer credit activity, and

even if you have no short or medium
term plans to take out new credit,

there are these upsides, like the fraud
prevention from having that oversight now.

Yeah.

It's probably a little bit unfair to
label it as an American thing, but

yeah, you were doing this 10 years ago.

And so it's obviously established
already in the UK, but in my mind,

there's a significant be higher
level of public discourse, at least

on credit reports and credit score.

In America or do you see similar
awareness now spreading in the UK?

I think you're absolutely right.

That credit scores in the
U S are better understood.

We're told that Americans ask
blinders, my score is seven 50.

What can you offer me?

And they discussed it openly
with friends over dinner, but it

hasn't quite penetrated the UK
consumer psych in the same way.

What's been really positive to
see recently though, is there's

definitely a growing awareness
of the importance of regularly

monitoring your credit probation.

And that's been particularly
evident through the.

TransUnion has been conducting a consumer
pulse study to track the impact of the

pandemic consumer finances and found
at the end of 2021 that almost half

the UK consumers and they're monitoring
their credit score at least monthly.

And that's up from a third at the start
of May, 2020 downside is our data has

also shown that a quarter of people have
never checked it, which is worrying, given

the important role that this information
plays in helping people get access to

finance and protecting their identity.

Yeah, that's interesting.

And several episodes now I've
spoken to people in collections and

we've spoken about the increased
awareness of collections and payment

accommodations, post pandemic.

So all consumers, whether they
actually needed help with collections

or help with payment holidays are
aware of them just because it became

such a, a common point of discussion
in newspaper, headlines, and such.

And I'm glad to hear that, that
sort of spreading awareness of

the tools available to borrow.

Is extending to things like credit
scores and the value in, in, uh, viewing

those speaking of that, of, of consumers
accessing their own credit report.

You mentioned not all and not credit
karma, but what ways to consumers have

of accessing their credit reports?

I know that, you know, long ago now,
but as piloting one of these programs

in another market, and it was a case
of having to print them out and read

them on a sort of a physical printout,
it's obviously a lot more advanced

and simple than that, these days.

One of the tools people are using to
keep a track of their credit reports.

Well, the good news for
consumers is that it's really

easy now to access credit data.

And, you know, in this digital
world we live in, there are lots

of websites and apps that offer
free online access to your report.

So aside from credit karma, there
is also toting money and money

supermarket provide TransUnion,
credit reports and scores for free.

So consumers can track how they're
firing and some banks and finance

providers and are making the
information available directly as well.

So we partner with NatWest
and Lloyd's and Monzo.

For example, if you're a consumer of
those, you know, you can go into the

app and see the transgendering credits.

And most of these sites provide
additional tools, quite interactive

tools or personalized guidance to help
you better understand the information

and you know where to get value from it.

And if it's just a one off copy of
your report that you need, that's still

available by our website or even offline.

If you, if you haven't joined the digital.

And that raises what might be a slightly
more delicate question I suppose,

but my audience is primarily lenders
and I assume they're going to have

the same question I had when I first
heard of that sort of credit karma

model, where these apps are paying for.

Well, these lenders will be paying for a
credit report out of their own pockets and

then handing it to the customers for free.

What are the sites to the
lenders or to these platforms?

Is that just Goodwill or are they
benefiting as well by providing this

beta education to their customers?

More informed customers are
typically better customers in terms

of score improvements, engagement,
loyalty, and ultimately revenue.

Let me share some stats with you
from our recent research to prove

this point a bit more scientifically.

So we found that 53% of self-monitoring
consumers increase their credit

score in the six months post
registration, which would make them

potentially eligible for new products.

So more people to sell to for the service.

Self-monitoring helps them fall
consumers move to full file.

So again, making them eligible for
the more products and a quarter X, I

wanted to end consumers who were then
violet registration moves to full file

after six months, that that compares
to any 9% of the UK in general.

So I think that indicates it's that
monitoring is a really powerful tool for

helping people build a credit profile.

The younger generations who are most
likely to be credit hungry are also most

likely to be engaged with these tools.

So we found that 63% of gen Z consumers
or gen Z 63% of gen Z consumers

monitored their file monthly, which is
almost twice that of older generations.

So it's a great way to acquire
younger customers and start

building a longterm relationship.

Um, we have data that shows
self-monitoring consumers outperform

the UK population in terms of
origination and balanced growth.

So for example, we've seen self-monitoring
customers grow that on brand balances by

25 to 35% over the initial six months.

And that compares to five to 15%
for consumers who haven't signed up.

So I think Solarize all of that,
really the lender benefits by

providing engagement tools that help
them build trust, build loyalty.

It provides a cross sell opportunity
and ultimately, you know, it helps

them better monetize that customer by.

And you mentioned there that
self monitoring consumers

increase their credit scores.

And that for the majority of people
increased credit scores, mean more access

to credit, but there are unfortunately
some consumers that are struggling and

an increase in your score improvement
in your score is actually about

getting out of delinquency, getting.

Financial strife.

Have you also seen that sort of
positive behavior in terms of delinquent

consumers, getting out of delinquency
with the help of self monitoring?

Yes, credit education and
monitoring can help consumers

improve their payment behavior.

W we've analyzed consumers who were in
arrears appointed time and then looked

at their payment status 12 months later,
and found that a high proportion of

customers who were self monitoring had
improved their arrest status compared

to a random population of the UK.

So it does improve payment.

Yeah.

Okay.

Then, as you say, the positive
flip side is how does providing

monitoring services to borrowers
help support new account openings?

And one of the tools we've recently
launched with clients, which is

proving really popular is a score
simulator, which allows consumers to

see what the impact of their actions.

Might be.

So if, for example, there stimulate
opening a new line of credit or paying off

a balance, you can then see what impact
that would have on your credit score.

That's a really powerful tool for
consumers because it helps them understand

what impact our actions will happen,
helps them make more informed decisions,

but we found it's also really useful
predictor of future behavior for London.

Because consumers go on
to do what they simulated.

So we found that 54% of south
Washington customers, one time

to complete the simulated action
within six weeks of using.

Now it's becoming, I think maybe
a bit of a theme here where I, um,

compare everything to open banking,
but to me, the underlying concepts

here of, you know, giving consumers
access to their data, allowing them to

control it carries echoes of a theme.

Of giving consumers in general or
control of their data, making it more

transportable, which at least in my
mind is a simple way of describing

the philosophy of open banking.

Obviously not the technology, but
that idea now open banking is another

one of the quivers in your bow and
TransUnion has obviously been investing

a lot of resources in building
out its open banking offerings.

What is your approach to open banking and
your sort of thinking behind it within,

I guess the consumer interactive Umbra.

Open banking is really high
on our agenda at Tanzanian and

that's for a couple of reasons.

And it provides access to a more real time
granular source of data that can enable

more insights and better decisions on
behalf of both consumers and lenders plus,

and this is subject to consumer's consent.

Obviously it can be used throughout
the consumer life cycle rather than

just other points of application.

So that allows us to identify
important changes in consumer behavior.

Which gives the lender an opportunity
to step in and offer help or more

appropriate services, you know, that
could be new lending needs, or it could

be the consumers is heading into trouble
and, you know, provide some good warning

indicators, allow the lamps then to help.

No, I think open banking and subsequently
open finance is the start of a shift

towards consumer having increased power
to contribute their own data and see

how it's used to their benefit as a good
thing for them is they have full control

over how it's used, how often it's
used, because it's all governed by X.

And talking there about shifting
trends and new trends starting.

We've obviously just been through
two years of rapid change and on all

fronts, but especially with things
relating to making digital journeys

to digital transactions possible and
open banking is obviously a technology

that's well-suited to enabling
consumers to start new relationships.

Carry on transactions in the online world.

Have you seen any impact on the degree
to which open banking was adopted?

Even the ways in which it was adopted
during the pandemic or because of the

pandemic we've seen open banking adoption
increase during the pandemic, particularly

amongst younger consumers who are showing
a desire for credit coming up in the

pandemic, the data is proving to be
helpful for some lenders to show that

they can lend say, play on responsibility.

That.

And, and that's TransUnion's
is focused on open banking.

Really it's about driving financial
inclusion, you know, making credit

accessible to them, file customers, prime
customers, and their prime customers.

I think this days we'll break down
some of the barriers we see in the

traditional lender ecosystem and
empower customers who are increasingly

willing to share their data.

And the key thing is that
there must be a value exchange.

So what we're seeing is consumers
will give access to their data if

there's a real benefit to them.

And that's likely to be, you know,
some things quicker, easier, cheaper.

So if you look insurance, for example,
where you can now share your driving

performance data to obtain lower premiums
or rental data is another example.

It's still early in the adoption curve,
but I fully expect it will become

the norm to use open banking data.

You don't have to go too far back
to when people were looked at

shell location data and put their
payment card details into an app.

And now that's second nature
and I've known now that open

banking will become the same.

So, as I say, it's early days, but
there's a lots of ways consumers

can benefit from proactive data
contribution, and we're really excited

to play a part in enabling all that.

We want to give consumers the ability
to easily access this data in a really

clear and transparent way that helps them
build confidence and financial awareness.

Yeah, I'm a big fan of open banking
myself, but it's an interesting trend

that I feel is popping up in more and
more applications, you know, with this

podcast, I would say it's almost one in
three, maybe even one in two episodes.

Somebody is talking about their plans
to use open banking within their

lending operations, but it's usually
in the back end and therefore a little

bit out of sight, which does make
it quite hard to work out how well

it is really being adopted in the.

Who is open banking benefiting and
how well, I think as far as the

maturity and adoption of open banking
increases, it's going to provide

benefits throughout the ecosystem.

So how consumers, if it's used in an
application journey, the consumer will

benefit from improved journeys and
increase likelihood of acceptance.

I think particularly for consumer
interactive, the interesting part

is that the data can also be used
in tools to educate the consumer.

So we can give them a greater insight into
the application and customer management

processes and allow them access to
personalized coaching content to help them

understand their finances, which again,
should, should ultimately result in score

improvements and greater product choice.

And it can be very effective at
building consumer trust and engagement.

And then for lenders and price,
comparison websites, open banking

facilitates on boarding of
previously underserved audiences

where credit files one's available.

And on the other hand, they're likely
to see reduction, but that by using

recent data, to identify by income
sharks, for example, that they could

have identified in almost real time.

We've been working with a leading UK
bank casually, which incorporated our

open banking solution into its a bit
tenacious journey for card customers.

And they've streamlined the
onboarding process by automating

and combine education.

And that's enabled them not only to
assess and accept more consumers, but

it's also saved them 3 million pounds
in cost to date with that automated.

So with the open banking, with all
the access to credit reports and the

innovation that's happening there, it
sounds like you're in one of the faster

changing and dare I say more exciting
parts of the credit bureau industry,

which I guess means we're expecting
just as much change in the years to

come what's next on your horizon for
you and for consumer interaction.

Yes.

So I think in the short term,
we're focusing a lot of our

efforts on financial inclusion.

So for example, helping things by
our customers build a credit profile

or helping the self employed sector
have been hardest hit by COVID.

I think finding new sources of data that
are reliable, a comprehensive at a time.

That's key to this, and that's why we're
making such an investment in open banking.

Why we've recently started taking a mental
data and why we're engaging now with buy

now pay later players who are starting
to contribute that data into the bureau.

And I'm sure that will be a ritual or bet.

Very complicated, a very
rich source of data.

We also made the investment in the nivo.

And that is to expand our capabilities
across the consumer credit life cycle with

eligibility or pre-qualification services.

So that means that we can now not only
allow consumers to understand their

credit score, but we can also then use
it to find personal credit products

are suited to them so they can apply
with competence of being accessed.

Our strategy will always be based
on enabling consumers to have a

greater awareness and power their
own data and how they can use

it to help achieve their goals.

We call this information
for good at TransUnion.

We were the first in the UK to offer
free credit scores, and we will

continue to disrupt the competition
with innovations that are in the

best interest of the consumer.

That will be products that
promote financial health.

But as the result for my mental wellbeing
as well, now it's more important given the

impacts of COVID on the health and wealth
of some of the segments of the population.

Yeah.

That's actually a really nice
message because we've talked a lot

about it in collections, in recent
episodes where people would be put

through rather unpleasant processes.

And it was almost used by lenders.

It felt like, uh, you know, a strategy
that if we make it unpleasant,

you know, people will pay us back.

But there was that trauma that some mental
health burden that consumers were paying.

And I hadn't thought
about it in originations.

It's the same, that consumers that
are, you know, the lower income,

the more vulnerable consumers are
the ones who, every time they need

credit have to go through a pretty
stressful process and more we can do

to take that unnecessary stress out
of a process that should just be, you

know, fairly neutral, uh, the better.

Thank you Kelly so much for joining me.

And I guess it's a little bit
more complicated than normal.

If consumers want to find out more about
accessing their credit reports, where

should they go and look, and if lenders
or platforms want to learn more about how

they can use some of their tools within
their businesses, where should they go

and look to find out more about what you.

So the best place to start is, is the
transgender website, trans union.co.uk.

And on that, there's lots of information
and clicks out to all of the free reports,

core services that we partner with.

And then there's also lots of information
and contact details for businesses

on how we can help them better engage
their consumers with credit view, which

is our consumer interacted tool and
lots of exciting innovations to come.

Right.

Thank you.

And thank you all for this.

This has been hard to lend money
to strangers with Brendan LaGrange.

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The show is written recorded
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found@wwwdotouttolendmoneytostrangers.show.

And I'll see you again next Thursday.