Until the recent fintech revolution, many Canadians in need of financial services only had the big banks to look to. When it comes to making decisions surrounding personal finances, it never hurts to have options. One particular startup that believes in this is Borrowell.
Borrowell, as the name suggests, aims to help Canadians borrow, well — well. With the support of the best and brightest investors, this Toronto-based fintech is on a mission to offer individuals a fast, fair and friendly way to loan money. From the comfort of your own home, people can take out personal loans of up to $35,000 in a matter of minutes online. Not only that, Borrowell is the first and one of few Canadian businesses that will check your credit scores for free without affecting your rating, as it should be.
We had the chance to interview Salim Naran, CTO of Borrowell, to learn more about his thoughts on fintech collaboration with banks, the secret sauce to their “one-click loans”, as well as the inside scoop on new and exciting Borrowell features to look forward to.
Trulioo: Congratulations on the recent partnership with CIBC! There’s been lots of talk about the co-operative nature of Canadians and how it gives us an edge in innovation. What are your thoughts on fintechs collaborating with incumbents?
Naran: Great question – given the Canadian landscape in financial services, we view collaborating with incumbent financial institutions as mutually beneficial for both parties. When I think of our strengths, we’re super nimble, hyper-efficient and deliver awesome customer experiences. But as with any new entrant in an established market, our biggest challenges are things like getting our products in front of potential customers, reducing customer acquisition costs, and creating brand awareness.
“Because online financial services is new and online, people think that it may be a little sketchy! — CTO @Borrowell”There’s also a big trust issue that you have to overcome as a fintech company in Canada. The online financial services space is similar in this way to online dating 10 years ago: because it’s new and online, people think that it may be a little sketchy!
Large banks, on the other hand, have very strong brand presence and are trusted by most Canadians, but they face different challenges. Banks have realized they have to build a very client-focused digital-first, banking experience. Customers expect banks to keep pace with the rest of their digital lives. Given their huge size, legacy infrastructure and traditional business priorities, many new initiatives quickly become costly and lack the support needed to move them forward. Those that do get the support they need may hit many roadblocks along the way, where costs exponentially increase.
In a great relationship, both parties help each other win. This is what we are building with the Borrowell/CIBC partnership. Partnering together allows Borrowell to bring its innovative products to millions of Canadians. And CIBC has been able to quickly add key products its customers are looking for.
During development, Borrowell has worked closely with CIBC Live Labs, the bank’s innovation and digital technology centre. We did product user testing at their centre, which helped us quickly learn what was most important for the bank’s customers. We used this feedback as we developed the digital loan process with CIBC. We learnt a lot from that experience, and we now try to do as much user testing as we can for our own product.
I’m sure I speak for both sides when I say we have already learnt a lot from each other. Rightly, the new products we deliver together are the headlines. But behind this is an exchange of ideas that is really valuable in the long run. We’re proud of the relationship our companies have built. We’re excited for the future!
Trulioo: Can you tell us a little more about your “one-click” loans? We can only imagine all the different regulatory hurdles involved with making it possible. How does Borrowell do it?
Naran: When Borrowell built its online loan product, we focused on taking out all the hassle of a traditional loan process. But we also built it to be safe and secure. Being a startup in financial services is challenging – you have to hold yourself to the same standard as a big bank. Customers rightly expect a high level of service – they are placing a lot of trust in you to handle their finances. Great technology combines form and function. We spend a lot of time thinking about improving the customer experience, while also making sure our service is as robust as any bank’s.
We launched our loan product over two years ago. We have seen a great response from Canadians who are looking for an innovative product that they can trust.
We have an advantage in not having to deal with the cost and complexity overhead related to legacy systems and older technology infrastructure. Our core development team has deep knowledge and experience in the financial services space.
We connect in real-time to both traditional data sources used for consumer lending and non-traditional data sources. This allows us to blend traditional credit data metrics with some exotic data sources in order to present a potential customer with an instant customized rate for a 3-year and 5-year loan product. Every step is online – ID verification, bank account set-up, right down to signing your loan document!
The entire loan application process takes no more that a few minutes to submit your application and choose your loan. It’s amazing that you can now get a personal loan digitally in a few minutes on your computer or mobile device. This is still a process that can take days and numerous conversations if you go to a branch.
For CIBC’s “one-click” loan offering, Borrowell integrates with CIBC’s online banking platform to connect to a customer’s account information. We then pass the data through our adjudication engine to present an instant approval decision and rate for those that qualify. Once the application process is completed on Borrowell’s platform, we then the loan specifics back to the bank’s lending platform. CIBC then funds the customer’s loan. The customer can then manage their loan via their CIBC online banking.
Trulioo: What’s next for Borrowell? Any exciting product features or company updates we can look forward to?
Naran: Borrowell’s mission is to help Canadians make great decisions about credit. Borrowell was the first company in Canada to provide Canadians access to their credit score for free. I believe that we have the leading, fully digital, personal loan product in Canada.
As we grow, we will continue investing time, dollars and resources to evolve the digital experience of financial products for Canadians. We are using data to make our products better for our customers.
Borrowell is incredibly data rich. We are using big data and deep learning to enhance our adjudication and recommendation engines. The end goal is to make better financial products for Canadians.
We’ve been in business for over two years and have been able to learn a lot from our data. Those learnings get automatically funneled back into our machine learning models and allow us to deliver better experiences at better prices. On the Free Credit Score side of things, we’re building an incredibly robust recommendations engine that will allow us to match customers with offers that we think will actually matter to them.
If there’s a fintech company you’d like to see featured in our Fintechs in Toronto blog series, please submit your request to [email protected].
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