Lending smarter with cash flow data: Plaid’s path ahead in Credit

Plaid has formed a new entity to build ready-made credit risk insights from consumer-permissioned cash flow data, aiming to help lenders make smarter risk decisions and expand credit access for underserved consumers. The company recognizes that traditional credit scores don't capture the full picture of someone's financial life, particularly when it comes to savings, income, or on-time rent payments. This new entity will operate as a consumer reporting agency, providing actionable insights from open banking transactions data to better predict a borrower's ability to pay. By tackling the usability problem head-on, Plaid aims to unlock opportunities for lenders to grow their business while managing risk, fostering inclusion and serving a broader set of consumer needs.