NewDay to offer better rates for borrowers who share open banking data via Experian Boost

Consumer credit lender NewDay will start to offer better rates for customers who share their open banking data.

The change will impact NewDay’s various brands, including Aqua, Fluid, Marbles and its consumer credit card Bip.

It comes via a partnership with Experian, whose Experian Boost service lets people share their open banking data with the credit bureau for a better credit score.

Going forward NewDay says borrowers who use Experian Boost are more likely to be accepted and may be given a higher credit limit as a result.

“This means we can offer applicants more favourable rates than they otherwise might have had access to, without increasing any lender risks,” said Gael Decoudu, director of credit decisioning at NewDay.

As Experian Boost data is collected at the credit bureau level, a borrower doesn’t have to apply for a NewDay product via Experian for their open banking data to be included in the decision.

The introduction comes after Experian decided to increase the size of the credit score boost enabled by Experian Boost, after its early success indicated that open banking data is “an even better predictor of creditworthiness than initially estimated”.

Experian Boost data can now increase credit scores by up to 101 points, up from a maximum of 66 points previously, which could shift a borrower up two score bands (say from Fair to Excellent).

“As economic uncertainty increases, it’s important that all consumers have more affordable products available to them,” said Sigga Sigurdardottir, managing director of consumer services at Experian.

“Our ambition with Experian Boost is to help as many people as possible across the UK increase their credit scores and make access to credit more inclusive, so we’re glad that our partnership with NewDay is providing that opportunity for consumers.”

NewDay’s partnership with Experian is broadly similar to what Shawbrook Bank offers via its open banking partnership with ClearScore, albeit borrowers must apply via ClearScore to qualify for a 1 per cent reduction in the APR.