Payday lender closes funding round and changes risk assessment tactics
Short-term lender enably is focusing on better risk assessment and larger loans after its recent funding round.
enably, a short-term lender that has recently rebranded from Loan Ranger, will be focusing on a "responsible lending" scorecard rather than a risk scorecard, which it says it traditionally used by lenders to assess the suitability of a loan for a borrower.
The payday lender has also recently closed one of the largest startup funding rounds of 2016, raising $33.5 million in debt and equity capital.
Speaking to the Australian Financial Review, CEO Andrew Kirkwood said enably will use the information gathered from the mandatory assessment of 90 days of a customer's banking history as well as the Enably IQ system to benefit consumers.
"Traditionally, lenders have used a risk scorecard that looks at various data points, but we've taken a different stance where we use that risk card, but it's secondary to a responsible lending scorecard," he said.
"We look at customers as individuals with unique lending circumstances and we examine their last 90 days of banking data and how much they spend on things like food, bills and other debt repayments they have."
The enably IQ system involves rejected applicants receiving their credit score as well as educating them on what their credit score means and how to improve it.
enably recently closed a $33.5 million funding round from Chicago billionaire Richard Driehaus and Ney York-based hedge fund Corbin Capital Partners. The funds will be used for business growth and to eventually offer larger loans.
"We're looking to grow fairly aggressively, so there will be further funding requirements in the future. Nothing is off the table and we're looking at how we can continue to increase our loan offering and have different products for consumers."