Castlight Financial, the Glasgow-based financial capability company, has partnered with HSBC UK in the delivery of the bank’s first open banking loan.
Following a test and pilot programme, HSBC UK has used Castlight Financial’s powerful categorisation technology tool, CaaS or Catgorisation as a Service, to process a live loan for a customer.
After the customer had securely linked their bank account to HSBC UK, the bank used its open banking technology to pull down all the transactional data. HSBC UK then ran the customer’s transactional data through the CaaS engine, which categorised income and expenditure into 155 categories, summarising income streams, credit commitments, essential costs and discretionary spending to reveal a monthly disposable income. The information was then merged with credit performance data and in under 10 minutes HSBC UK had all the information they needed on which to make a highly informed lending decision.
CaaS was able to provide HSBC UK’s underwriters with enhanced data direct from the customer’s bank account, allowing the bank to give their customer a better, faster service.
Martin Leonard, Castlight Financial Chief Operating Officer said: “The open banking team at HSBC UK have been quick to recognise the ways in which the new world of open banking can deliver added value to their customer base. We are, of course, delighted that our CaaS technology will be instrumental in allowing the bank’s lending teams to deliver fast, accurate and insightful decision making and ultimately an enhanced customer experience.
“With the implementation of the CaaS technology HSBC UK’s lending team and underwriters will have unprecedented insight into a customer’s financial wellbeing at the touch of a button. But for Castlight Financial we believe its also good news for the wider lending industry as CaaS, at its very heart, is a tool for ensuring that borrowers borrow safely and lenders lend safely. It has been hugely encouraging to work with HSBC UK and see their commitment to these important values and how quick they have been to appreciate that CaaS not only delivers solutions for their lending teams and benefits for their customers, but that it contributes to wider financial security which is a good thing for everyone.”