Reinventing credit scoring
In developing driver1 over the past year I have met and spoken with many of the car finance industry lenders, brokers and technology enablers. With our customer segment (young drivers under 25) we’ve been faced with anything from, “ah they are too risky we don’t deal with them”, to more progressive responses of “we know we should be helping them but our processes are not really setup for them yet, they’ll just have to use our standard application form like everyone else for now”.
Well in my experience, one size doesn’t fit all.
No young person has a meaningful credit score these days, let alone meeting the magic algorithms prescribed by the traditional lenders.
You can’t have a car finance application that asks young drivers for 3 years of employment history (ermm.. so that means if I study hard and go to Uni then I’ll be 24 before I can have a car). And what’s the point of a credit score? No young person has a meaningful credit score these days, let alone meeting the magic algorithms prescribed by the traditional lenders. Its nonsense.
I’m no stranger to running a tech incubator and so we’ve setup Driver1 labs, to develop products that put the young driver first and in control of their car usership, whatever that may be from buying, leasing, subscribing, using, renting or sharing.
The first product out of the lab is a mobile app called driverifi.
The mission of driverifi is to fill the huge gap that has opened up as consumer behaviour has changed but where the car finance industry has been left playing catch-up. We all know this is the case, but an agile startup is much better placed to fill this gap quicker. Look at other fintech companies like Revolut and Monzo and you’ll see that any new fintech solution gets much better adoption if its designed from scratch by startups.