In Online Lending, Application Velocity Points to Increased Risk
In October 2016, ID Analytics announced the formation of the Online Lending Network (OLN), a consortium established to enhance responsible lending, help protect consumers and address credit and fraud risks.
Through the OLN, lenders report when a consumer requests an offer for a loan product, submits a loan application, or when a loan is funded. In return, the lender receives information on whether that consumer has requested other loan offers or applied for loans elsewhere in the days, hours or minutes before. The near real-time nature of the response makes high-velocity fraud, like loan stacking, very difficult. It also has the potential to protect authentic consumers from overextending their credit capacity to facilitate responsible lending.
Earlier this week, we announced findings showing that 1.5 percent of online loan applicants were seen applying at or seeking offers from other lenders within six hours of submitting their application, and this group was found to be twice as risky as the average online loan applicant.
Click here to view the full announcement.
Click here for more information on the Online Lending Network.