Yet many banks and credit reporting agencies have already been sluggish to innovate on credit scoring for low-income borrowers, claims Raj Date, handling partner at Fenway summertime, a Washington firm that invests in economic start-ups. The standard price on prime-rated charge cards is 2.9 %, Date claims.
“Banks don’t care should they can cut defaults among prime or superprime borrowers by a quarter of a spot,” says Jeremy Liew, somebody at Lightspeed Venture Partners, a ZestFinance investor since 2011. Continue reading “With therefore few deadbeats, and low-cost money from depositors, banking institutions don’t have a lot of motivation to get into Merrill’s complex algorithms.”