About Koyo Loans
In 2018, Koyo became the first company to use Open Banking data for credit decisions.
Open Banking can be especially helpful for “thin-file” borrowers - borrowers who haven’t built up a credit history yet, because they’re new to the UK or haven’t taken out a loan before.
Conventional credit checks look at whether would-be borrowers have a history of paying back loans. If you’ve never taken out a loan, even though you’ve never missed a payment, traditional lenders find it hard to offer credit - because you don’t yet have a track record.
This is another advantage of an Open Banking lender: unlike traditional credit checks, Open Banking data can be used to verify information and focus more on affordability. That means that Open Banking lenders don’t have to rely on what someone else says about you when you apply for a loan: they can base decisions on creditworthiness on real data.