Abound taps ClearScore for debt consolidation

This partnership between Abound and ClearScore signals a major shift in how lenders approve customers who are already carrying debt. By using 'Open Banking' data, lenders can now see a real-time view of a customer's finances instead of relying on stale credit scores. For retailers and service providers, this technology is important because it increases the 'buy power' of your customers. ClearScore’s 'Clearer' tool automates debt consolidation. It identifies high-interest debt that a customer is currently paying off and helps them roll it into a single, lower-interest loan. For the merchant, this means a customer who previously had no room on their credit cards might suddenly have the cash flow available to make a large purchase. Abound uses AI to look at bank transactions directly. This allows them to approve loans for people that traditional banks might reject due to high debt-to-income ratios. As these tools become more common, expect to see your financing partners offer higher approval rates for customers who are currently stuck in high-interest debt cycles.

Source: Finextra — Lending

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