Converging the power of mobile credit risk scoring and digital fraud management technology to access Southeast Asia’s 400 million unbanked and new-to-credit population
SINGAPORE – Media OutReach – 16 June 2020 – GBG (AIM:GBG), the global technology specialist in fraud and compliance management, identity verification and location data intelligence today announced a technology partnership with CredoLab, the leading developer of bank-grade digital scorecards based on privacy-consented and permissioned smartphone metadata, to easily and confidently assess the creditworthiness of any applicant, including the unbanked and underbanked. While banks in Indonesia have tapped on local bureaus, telcos, and e-commerce providers for data to perform credit and fraud checks, data continues to be fragmented and unreliable, contributing to high non-performing loans, low approval rates and a high level of fraud. This technology partnership will help brick-and-mortar and digital banks deterred by a lack of data to leverage on mobile phone digital footprints to process banking and credit applications and provide financial empowerment to all new-to-credit, new-to-bank, and gig economy workers of the region.
Of the nearly 400 million adults in Southeast Asia, only 104 million are fully “Banked” and enjoy full access to Financial Services. Another 98 million are “Underbanked”, with a bank account but insufficient access to credit, investment and insurance, while 198 million remain “Unbanked” and do not own a bank account. Millions of small and medium enterprises also face large funding gaps. However, the booming internet economy, which is predicted to reach US$300 billion in 2025, sets the stage for the lending industry to grow by more than 2 folds by using digital technology to their advantage.
“We are very excited with this partnership between GBG and CredoLab. By assimilating metadata on consumers’ digital footprint and behavioural intelligence into GBG Instinct digital fraud management platform, we are seeing an uplift in credit and fraud risk protection by up to 40%. This convergence between mobile credit scoring and digital fraud technology helps established and digital banks and lenders onboard quality customers within the financially excluded population,” said June Lee, Managing Director of APAC.
GBG offers an end-to-end digital fraud and compliance solution for banking and non-banking financial institutions looking to onboard and transact with their customers quickly, safely, and securely. With GBG Instinct, banks, lenders, and mobile wallets can leverage an orchestration layer to perform multiple data callouts to CredoLab’s cloud service. It only takes seconds, as opposed to days, to analyse mobile behavioural data and calculate the risk score for any individual to be onboarded.
The result is of the partnership sees an uplift in scorecard predictiveness by up to 39.9%, drop in cost of risk by up to 21.9%, and increase in approval rates of up to 32%.
“Banks and lenders always grapple with the question of “can a customer pay back” and “will a customer pay back” during the onboarding journey. While GBG’s fraud solution flags out suspicious behaviours of customers who “cannot pay”, CredoLab’s behaviour risk score, lowers false positives and false negatives on delinquent behaviours to discern if a customer “will not pay” explained Peter Barcak, CEO and Co-Founder, CredoLab.
In Southeast Asia, which has 360 million internet users, this partnership provides a gateway into accessing the largely untapped unbanked and new-to-credit populations, and the thriving gig economy workers of the country.
Today GBG works with more than 100 financial institutions across the region with active implementations in more than 30 countries; CredoLab has delivered alternative credit risk scores to 7 Indonesian lending businesses amongst over 70 others across 21 countries. The partnership will enable all Indonesian banks, neo banks, and digital lenders to access and approve quality customers with the intelligence required to accelerate onboarding, detect fraud, and reduce operational costs.
 Google & Temasek / Bain, e-Conomy SEA 2019
GBG offers a range of solutions that help organisations quickly validate and verify the identity and location of their customers. Our market-leading technology, data and expertise help our customers improve digital access, deliver a seamless experience and establish trust so that they can transact quickly, safely and securely with their customers online.
Headquartered in the UK and with over 1,000 team members across 16 markets, we work with 19,000 customers in over 70 countries. Some of the world’s best-known businesses rely on GBG to provide digital services and keep the economy moving, from US e-commerce giants to Asia’s biggest banks and European household brands.
CredoLab develops bank-grade digital scorecards for banks, consumer finance companies, auto lenders, online and mobile lenders, insurance companies, and retailers from the best alternative data source – smartphone device metadata. Built on over 21 million loan applicants across 70+ lending partners, our AI-based algorithm crunches millions of datasets from opt-in smartphone metadata to find the most predictive behavioural patterns before converting them into alternative credit scores. These enable any lender to make the most granular assessments possible of their applicants.
Established in Singapore in 2016, CredoLab has powered well over USD 1 Billion in loans issued after analysing about 1 trillion data points across 21 countries. We are backed by Fintonia Group, FORUM, and Walden International.