ABSTRACT
The loans were given based on a borrower’s ability to repay with interest, which required merchants to assess the qualities of individual borrowers, as well as the inherent risk of their venture. In 1956, an engineer named Bill Fair joined forces with a mathematician called Earl Isaac to create a standardized and objective way of assessing the credit worthiness of prospective borrowers using data inputs. Market risk functions would typically produce probabilistic models and simulations to assess the likelihood of certain outcomes–often founded in liquidity stress testing. The United Kingdom (UK) has been one of the first jurisdictions to implement a mandated Open Banking regime. In an Open Banking world, if a bank chooses to leave unique customer data unused they can be certain that a plethora of competitors will be lined up to give their customers personalized, relevant and intuitive experiences using the same data.
