What is Open Banking?
Open Banking was introduced by the UK government in 2018 to drive innovation in financial services. It’s a technology that lets you share your financial information safely and securely over the internet. It’s only available with specially regulated providers, like Loal.
With your permission, Open Banking allows Loal to connect to your bank account and, because it’s all done by machines, all of your information is secure. Open Banking helps Loal understand your money habits and provide the right support as and when you need it.
The team at Money Saving Expert has put together a helpful article explaining Open Banking in more detail.
What is Open Banking?
Open Banking is the secure way to provide us with the verified income and expenditure information we need to support your loan application. It is the same as sending us bank statements but faster and more secure. Watch this video to find out more about Open Banking.
How does it work?
To verify your loan application, you will need to login to your main online banking website. Your login details will always remain private between you and your bank. They are never shared with us or anyone else. It’s a very quick process, taking no more than a couple of minutes:
- Click Proceed when prompted in the app
- Log in to your bank account
- Verify Credit Kudos
- Continue with your application
Who is Credit Kudos?
We’ve partnered with Credit Kudos to help you get access to fair and affordable credit through Open Banking. Credit Kudos is the leading authorised Open Banking third party in the UK and, just like Oakam, is regulated by the Financial Conduct Authority (FCA).
If you choose to proceed with your application via Open Banking, we’ll connect you to Credit Kudos who will guide you through a few steps you need to take. Then you’ll come back to us and we’ll use the information provided to assess your loan. There’s lots more information on the Credit Kudos website.
Will my information be kept safe?
Yes. When you are asked to log in to your online banking account to enable Open Banking, you are only providing those details to your bank, not to Oakam or to Credit Kudos.
The information shared with us is similar to what you see on your bank statements. The information is then fully encrypted and shared with Oakam across a secure connection, so it’s actually more secure than sending in bank statements by post or email.
Will Open Banking guarantee that I will be accepted for a loan?
Open Banking only gives us the information we need to assess your application. It can’t guarantee that you’ll be accepted for a loan, but it does mean we can make more accurate decisions on who we lend to.
Once we have verified your information using Open Banking, we’ll present you with our decision on whether or not we can offer you a loan today. We can approve many more loans because of Open Banking as we can confirm the details of a greater number of applicants.
Will Open Banking affect my credit score?
No. Applying for a loan with Oakam involves a search of your credit history whether you use Open Banking or not. The extra step of using Open Banking to assess your application will not involve an additional credit history search and so will not impact your credit score.
Still having trouble?
Don’t worry, if you cannot find the answer to your question here, get in touch with one of our team.Talk to us