Speed has always been a commercial advantage in auto finance, but it’s no longer enough. As well as responding quickly, lenders need confidence that the
data they’re using reflects a borrower’s actual financial position in real time.
Traditional affordability checks were dependent on payslips, credit bureau reports, or document uploads. This meant they often fall short in a world where
incomes are variable, outgoings are rising, and consumer expectations for digital-first journeys continue to grow.
Why real-time affordability is essential
Auto finance is under pressure from multiple sides. Consumers increasingly expect faster, digital approvals, often within minutes. At the same time, affordability
regulations are tightening, and economic volatility is making it harder to assess risk using historic or inferred data alone.
What’s becoming abundantly clear is that legacy processes are showing their age. Asking customers to upload bank statements creates friction and dropout
risk. Payslips don’t capture income nuances, especially for self-employed or gig economy applicants. And credit bureau files, while valuable, reflect financial history rather than current circumstances.
These blind spots manifest in everyday outcomes:
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Consistently earning gig workers flagged as high risk
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Customers approved despite being financially overextended
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Drop-offs mid-journey due to burdensome document requests
The solution is better inputs. That’s where Open Banking data plays a pivotal role.
The value of open banking data in auto finance
With consumer consent, Open Banking provides access to real-time, categorised transaction data across income, expenditure, assets, and liabilities. For
lenders, this means building a far more accurate, dynamic view of an applicant’s financial reality, often within seconds of application.
Here’s what that unlocks:
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Income verification in real time
Go beyond gross salary to understand income types, consistency, and frequency. This is crucial for assessing affordability in today’s portfolio-earning economy. -
Detailed expense categorisation
Understand fixed commitments, priority bills, and high-cost credit exposure at a glance. Structured data supports more tailored underwriting decisions. -
Multi-account visibility
Aggregate insights across all consented accounts, revealing financial behaviours that are otherwise fragmented or hidden.
For many lenders, this data now supports both straight-through processing for low-risk applications and faster escalations for those requiring referral,
which strikes the right balance between automation and oversight.
Meeting new expectations in the car buying journey
The car buying journey itself is changing too. Research shows six in ten consumers are open to multiple vehicle options when they begin the process, and
many compare dozens of models online before committing. Over 60% now favour a fully digital buying experience, with nearly half comfortable purchasing entirely online.
In this landscape, any delay—especially in financing—creates an opening for competitors. Lenders that can deliver a confident credit decision early in
the process are more likely to retain the customer and influence their final choice.
Open Banking helps streamline that experience. It removes the need for applicants to hunt down PDFs or switch channels to share documents. It reduces dropout
risk by keeping the journey frictionless. And it supports smarter decisions, even in cases that don’t fit the standard profile.
Embedding intelligence into lending workflows
Critically, the value of Open Banking data doesn’t lie in access alone. It also depends on how well it integrates into existing credit workflows. Lenders
need data that is:
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Categorised and decision-ready
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Delivered via low-friction APIs
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Compatible with existing risk and operations frameworks
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Compliant with regulatory and audit expectations
When structured properly, real-time affordability insight becomes an enabler of both speed and governance. It empowers automation without sacrificing oversight
and gives credit teams the clarity to act quickly—with confidence.
Looking ahead
As digital car buying accelerates and consumer financial lives grow more complex, the ability to make fast, responsible lending decisions will increasingly
hinge on real-time, accurate data. Open Banking offers lenders a way to move beyond the trade-off between speed and quality, delivering both in a single, streamlined process.
