2018 BAI Global Innovation Award Finalist
Innovation in Societal and Community Impact
Nova Credit – U.S.A.
Access to International Credit Data, Helping Immigrants That Lack Domestic Credit History
Lack of a domestic credit history keeps millions of immigrants from realizing their dreams. The Nova Credit team hails from all over the world and experienced firsthand the challenge of not having a domestic credit history, which can prevent access to credit, housing and other services. Nova Credit provides a solution that enables immigrants to share their credit history from their home country with financial service providers and others, unlocking new consumers for lenders, property managers and other businesses as well as new futures for immigrants. The team is based in San Francisco and backed by General Catalyst, Index Ventures, First Round Capital, NYCA, and Core Innovation Capital. To learn more visit www.novacredit.com.
Although having built substantial credit histories in their home countries, access to credit cards, loans, mortgages, leases, phone contracts and more can be very burdensome for immigrants and other new-to-country consumers without a U.S. credit history.
These consumers are essentially shut out of the financial system of their new home country. This is not because domestic businesses have inherently bad intents – they just do not have access to a data set that allows them to accurately assess whether consumers qualify for their products and services.
The founders of Nova Credit are first- and second-generation immigrants from the U.K., Russia and the Netherlands. They came together to build a solution to solve this problem and accommodate the need of a secure, compliant and bank-ready technology to make better underwriting and approval decisions for international applicants. This applies to all sorts of products that require a credit check such as applications for credit, apartment leases and many more. Domestic consumer credit databases from leading credit bureaus around the world that have previously been isolated are now accessible through a single API and available to businesses upon consumer consent.
The current team at Nova Credit is comprised of 92 percent first- and second-generation immigrants, meaning that the problem we solve is not only one we deeply care about but one we’ve experienced first-hand.
Nova Credit has built integrations to the databases of international credit bureaus. The Nova API enables financial institutions to underwrite immigrant applicants on the basis of real credit data. This solution (1) unlocks growth among millions of new consumers for lenders, (2) reduces the operational complexity of trying to pull in proxy data and alternatives to underwrite immigrants, and (3) serves to manage the risk of underwriting consumers.
Essentially, Nova Credit is challenging the credit reporting industry and the traditional credit bureau model by pioneering the technology that enables immigrants to own and share their credit data across borders. This has never been done before due to the fragmentation and regulatory complexity in the global credit reporting market. For the first time, global citizens will be able to aggregate their history over time and across countries, no matter how often or where they move. When moving countries, a lack of domestic credit history will no longer be a problem for consumers, as they can control and share one global credit file that is accessible and valuable to businesses everywhere.
There are over 46 million immigrants in the U.S., of which about 10 million are recent immigrants who have rich credit histories in their home countries and can be unlocked with Nova data. But this problem isn’t just limited to the U.S. — there are over 240 million immigrants around the world who are limited from realizing their potential due to a lack of domestic credit history.
At Nova Credit, our goal is to cover every single country in the world. Today, our bureau partnerships already cover about 55 percent of the immigrant flow to the United States thanks to our integrations with to the leading credit bureaus in India, Mexico, Canada, and the U.K. among others.
We are serving both real estate and financial services in the space by working with top U.S. credit card issuers as well as the top property management platform Yardi® and several of the top 25 property managers across the country.
Together with our partner TransUnion®, we launched in our first international market: Canada. Nova is now able to also help immigrants coming to Canada bring their credit history with them when they move, enabling Canadian newcomers to finally access the products and services for which they are eligible.
Our goal by the end of 2018 is to have built on our foundation and reached market coverage such that this problem no longer exists.