Online lenders are not risk averse. With average default rates looming around 30%, they’re conditioned to accept a certain amount risk. However, the reward (in the form of high interest rates) makes the risk of potential default worth lenders’ while. The one risk lenders cannot tolerate is fraud.
We know that roughly 1 in 3 borrowers will default somewhere along their payment plan, but lenders will take that risk every time. Many will even work with that defaulted borrower again because these are real people with real financial needs. Often times, the borrowers have intent to payback their loans, but simply lack the resources to do so.
It’s a completely different scenario with fraud. Fraudsters are not people with real financial problems, they are criminals with zero intent of paying back the loan.
In every loan management process, a threshold develops around a score or weighting based on factors from creditworthiness to the loan amount applied for. Applicants fall on either side of that threshold: those above the line are worth the risk, those below are not.
The belt takes shape above and below that line. Lack of identity verification allows the belt to widen. Fraudsters increasingly find themselves above the line and approved for loans, while good borrowers worth taking a risk on are pushed below the line.
Without identity verification steps at the top of the waterfall, lenders miss opportunities to extend credit to those good borrowers and position themselves for continued losses to fraud. How well can you identify the individuals applying for your service? That’s where we come in. We help online lenders fight this fraud by tightening the belt with global identity data.
Whitepages Pro Identity Check gives you the most accurate information to verify your customers. Identity Check uses 5 data elements to verify the identity behind every applicant, moving good borrowers above the line while sniffing fraudsters out of the loan process.
Also, we understand speed gives a competitive edge when one-third of borrowers choose the lender with the fastest time as opposed to the best APR. We partner with lenders to accelerate the online lending process to fight fraud without sacrificing speed using quality identity data.
Watch this video to see how we can help you improve your online lending process.