Thanks to new credit record integration technology, payday loan providers will now have no excuses when it comes to determining whether or not their customers will be able to afford to repay the sums they borrow, it was recently revealed.
Equifax, one of the leading providers of credit rating information, has entered into an agreement with an online and payday advance lending data specialist known as Lending Metrics in an attempt to take guesswork out of whether a given borrower will be able to pay back their short term loans on time. With the short term loans industry currently preparing for the 25 July start date for its new Code of Practice, the announcement means that there will be just one more layer of protection between would-be borrowers and lenders who seek to provide loans to individuals who could never afford to repay the finance on time.
LendingMetrics first launched its Dynamic Application Search tool in September of last year in order to provide a way for payday loan providers to share information in an effort to practice responsible lending. The DAS tool is already employed by around two out of every three payday lenders, but with the new partnership with Equifax, lenders who use DAS will now have even more information at their fingertips regarding applicants, and will be able to reduce the number of individuals who are already drowning in payday loan-related debt from taking out any more, while also acting to ferret out any instances of fraud.
Equifax brings the full force of its consumer credit data to LendingMetrics’ tool, with the additional benefit of providing information especially relevant to the payday lending industry. On top of that, the identity checking technology used by Equifax to prevent instances of identity theft will also be made available to payday lenders that use LendingMetrics’ DAS tool.