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UKTN Podcast: Fintern founders on using open banking to ‘fix’ consumer lending

Fintern podcast

The latest UKTN Podcast is out now. This week’s guests are the founders of fintech company Fintern, Gerald Chappell and Dr Michelle He.

Founded in 2020, Fintern provides consumer lending to those rejected by high street banks. Customers link their accounts using open banking so Fintern can “X-Ray finances” and look beyond traditional credit scores.

“What that credit score is not doing at all is looking at your current financial circumstances,” said Chappell, Fintern CEO. “How much do you earn? What do you spend that on? What’s left over at the end of the day? And that is the real thing that determines someone’s ability to pay.”

The company uses artificial intelligence to crunch data and provide loans to those with a poor credit score, such as someone that has just moved to the UK.

During the show, the Fintern founders tell UKTN Podcast host Mark McDonagh about the startup’s business model, the challenges of attracting data scientists and its mission to “fix” the consumer lending market.

“We are deeply frustrated with what’s currently being done and we fundamentally believe that what we’re doing is going to be very, very different and a gamechanger,” said Dr He.

In April 2021, Fintern raised £32m in debt and equity funding. Earlier this year, it raised an additional £8m in a Series A round.

The pair tells the UKTN Podcast about “needing money to lend” and going nearly the whole way through the first funding process without meeting anyone face-to-face during the pandemic.

“We were turned down by a lot of people,” said Chappell, because Fintern was “too early stage” for many investors.

But before that, the main focus was on getting the regulators onside.

“The starting trouble is not actually the money, it’s getting regulation,” said Chappell. “You can’t lend a penny of money, no matter how much you have, until you’re authorised by the Financial Conduct Authority in the UK as a consumer credit provider.”

Elsewhere on the show, Chappell and He discuss some of the consumer trends that Fintern observed. That includes the rise of buy now pay later – which doesn’t typically show up on credit scores – and a surge in cryptocurrency purchases.

You can listen to all this and more in the latest episode of the UKTN Podcast, and catch all previous episodes here.

Don’t forget to subscribe to the UKTN Podcast on Spotify, Apple Podcasts, or wherever you catch your favourite podcasts.

The UKTN Podcast is sponsored by Uncapped, which provides no-equity investments from £10,000 to £5m to the founders and companies who are changing the world.