Exclusive: ClearScore and Zopa ink deal to bring open banking to the credit industry

By Aisling Finn on Tuesday 11 May 2021

Alternative LendingDigital Banking

One step closer to removing the “computer says no” attitude to credit cards.

Exclusive: ClearScore and Zopa ink deal to bring open banking to the credit industry
Image source: Andy Sleigh/ClearScore

Another partnership that seems to be a match in fintech heaven, this time for credit marketplace ClearScore and digital bank Zopa.

Currently, four million people in the UK use open banking in their day-to-day lives, with the technology spreading across all fintech sectors and now, for the first time, into the world of credit cards too.

The collaboration is the first time that a credit marketplace and a credit provider have teamed up to utilise open banking.

By combining real-time open banking data held by ClearScore and Zopa, users will be able to find out immediately if they are pre-approved for a Zopa credit card.

The Zopa credit card offered via ClearScore’s marketplace will have a personalised APR and limit depending on a customer’s creditworthiness and personal financial situation.

“We’ve been working with our partners to truly unlock the value of open banking, with regards providing greater access to credit, which, is so important, particularly in this day and age,” Andy Sleigh, COO of ClearScore, told AltFi.

“This is the first partnership that we’ve been able to create with our friends at Zopa, which is the first-ever credit card in the UK that’s going to be using open banking data in its underwriting, which is a really big step forward for the industry as a whole.”

By leveraging open banking, ClearScore users who may have been turned down from credit products in the past can now access Zopa’s pre-approved credit card as the decision takes a wider view of their finances into account.

“As a result of Covid-19, a lot of people have gone through life events that they may not have done before, which means that their ability to access credit at fair prices is priceless,” Tim Waterman, CCO of Zopa, added.

“Traditional banks take a much more ‘computer says no’ attitude to lending when people have adverse markers on their credit file. So through the use of open banking, we can take a much more holistic view of a consumer’s financial situation and lend responsibly to those that would have otherwise been excluded,” he went on.

In fact, 37 per cent of those that have signed up for the credit card so far, would not have qualified for a Zopa credit card using traditional credit decisioning methods.

Of the 200,000 ClearScore users that have already linked their data to the app via open banking, 43,000 have seen a Zopa offer which, under normal circumstances, would not be available to them based on credit report data alone. 

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