Open banking startup Abound nabs $601M to supercharge its AI-based consumer lending
After a slow start in the UK and Europe, open banking is catching on with fintechs, who are using APIs to access banking data and rails and using them as an alternative to traditional credit networks to build products.
Now, a UK-based consumer lending service called Abound is doubling down on its ambitions in the space with a big fundraise to fuel its own open-banking-based business. The startup has raised a whopping £500 million ($601 million at today’s rates) — money that it will be using to help finance loans, to bring more customers on to its platform, and to invest in its technology, which combines open-banking data and machine learning algorithms to build what Abound believes is a better “credit score” for applicants. To complement its direct-to-consumer offer in the UK, Abound also plans to expand as a B2B service in Europe, which has been building out its own open banking framework, PSD2.
“We see ourselves as going beyond credit scoring,” CEO and co-founder Gerarld Chappell said in an interview, who describes the bank transaction data that Abound uses to…