Equifax, the consumer and business insights expert, and Castlight, the leading financial capability company, have formed an alliance with Oakbrook Finance, the owners of consumer loan brand Likely Loans, to develop new products for the 2018 Open Banking initiative.

Under Open Banking, bank transaction data will play a crucial role in lending decisions. Lenders will have access to real-time and historic account and transaction information, boosting transparency when reviewing loan applications. Products currently in the pipeline as part of this collaboration will capture bank transaction data and use this to build characteristics of the individual applying for a financial product, providing a clearer picture of a borrower’s financial position and reducing friction in the customer application process.

Jake Ranson, Banking and Financial Institutions Expert at Equifax,said: “Open Banking will radically change the way people assess their finance options and financial companies have a responsibility to ensure a smooth transition into this new environment. Since the start of this year, Oakbrook has been utilising the Castlight Affordability Passport tool with Equifax data integrated, and we look forward to building on our relationship with Castlight to develop products that will help the industry use this new data for the benefit of the end customer.”

Martin Leonard, Chief Operating Officer at Castlight, said: “This alliance is an important step towards offering those with poor or flat credit files the opportunity to access finance. By using information drawn from bank transaction data, lenders such as Oakbrook will have a more accurate view of a person’s financial capabilities and be better placed to assess their risk level, while maintaining a smooth customer experience.”

Tim Waterman, Chief Analysis Officer at Oakbrook Finance, said: “As 2018 fast approaches, we’re preparing for the opportunities created by the Open Banking Initiative. Equifax and Castlight are ahead of the game in the development of Open Banking products that enable lenders to access transaction level data in a seamless way. This is an important alliance for Oakbrook as we continue to work hard to ensure we’re making the most responsible lending decisions for our customers.”