Oakbrook and Open Banking

28th September 2020

Changing Lending For The Better: Why agility and Open Banking are key to success

If lending is going to change, it must change for the better – for borrowers, for lenders, for regulators and investors. In the first of a series of blogs, Oakbrook Finance CEO Luke Enock explains why transforming decisioning means transforming organisations

What happens when the world hits a bump in the road like the almighty Covid-shaped bump that’s been thrust upon us? There are two schools of thought that I’m aware of:

  1. ‘We’ll get back to normal at some stage’ – because human desires are innate and they’re shaped by existing systems.
  2. ‘Crises can accelerate change’ - particularly when those existing systems are exposed to new weaknesses.

Lending has to be in for a fundamental shift. With many people’s circumstances impacted by Covid, how can we make robust, forward-looking lending decisions based on their most up-to-date finances - decisions which are right for them and for us? And in an economic climate defined by ongoing uncertainty, how can organisations deliver the rate of change needed to respond? This is a real case of challenge becoming an opportunity (if you’re in the camp 2 school of thought).

Lending businesses and aggregators now have a legitimate reason to pause and take stock, to review all their processes so we can collectively improve the world of borrowing for our customers. At Oakbrook, we believe that Open Banking’s ability to give richer and more timely insights into people’s financial health is clearly part of the answer and the Covid crisis has accelerated our Open Banking strategy. But this isn’t a simple, plug-in solution: implicit in Open Banking is both a fundamental evolution in lending decisioning, and an organisational agility which runs deep into culture, technology infrastructure and ways of working.

In a challenged market where lending volumes are understandably down, risk is heightened and decisioning complicated, the mission-critical problem for many lenders is that their operational bandwidth has been consumed by supporting customers. Bolting an Open Banking API into this kind of scenario could create additional pain points by unleashing a new wave of data without the capacity to process it. This is strategic change at its most challenging and exciting.

We’re proud to take a lead in Open Banking. Our proprietary, next-generation decision engine, built to rapidly accept an ever-expanding range of data sets, has meant a more seamless integration into Open Banking and a continuous release of improvements.

Moments like these are a huge test of business capability. Everyone in the industry knows that Open Banking is going to play an increasing role in decisioning; and we are proud to lead the way and use this hugely disruptive situation to help change lending for the better!

In our next episode: Our Chief People Officer, Sarah Marriott, explains how culture eats strategy for breakfast – and why it’s critical to creating the right environment for continuing change.