Credit decisioning software forms backbone of financial inclusion

Credit decisioning software forms backbone of financial inclusion
Michaela Holman, Global Account Manager at Itemate Solutions

Itemate Solutions has partnered with Decision Rules, an international startup, to drive the adoption of its market-leading business rules engine among African fintechs.

Michaela Holman, Global Account Manager at Itemate Solutions, says the Decision Rules business rules engine (BRE) can form the backbone of greater financial inclusion by supporting more flexible decision-making within fintechs.

“The financial sector operates on a broad set of rules around credit scoring, interest, fees, qualifying criteria and more. Decision Rules allows fintechs to more easily adapt rules to changing market conditions, speeding up decision-making around applications and thereby improving access to much-needed financial services among underserved markets.”

Decision Rules, developed by eppTec and founded in 2020, provides a cloud-based no-code rule engine, used by companies both globally and across a wide range of sectors, including South African fintech companies.

The company’s BRE allows fintechs to be more agile in their decision-making by enabling business users to quickly set up, test and change rules in response to changing market conditions, with the engine executing up to 100.000 decisions per minute.

“Typically, fintechs would need quite a lengthy and complicated development process to update the business rules underpinning, for example, their credit scoring functions,” explains Holman. “With Decision Rules, financial services providers can respond to changes in the market quickly. For example, if a lender uncovers a new form of fraud, they can update their rules quickly to disallow that instance. This provides greater agility to how fintechs respond to customer needs and market changes.”

Decision Rules’ business rules engine also builds a customer profile that enables fintechs to check the criteria of applicants prior to sending their information for a credit bureau check.

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If the criteria are not favourable to a successful credit application the system can halt the application process immediately, saving time and avoiding the fee that a credit bureau would charge for the credit check.

“This can be particularly consequential for fintechs working in high-volume, low-cost markets, where every cost saving can have a significant impact on their longer-term viability,” says Holman.

The company is currently working on a project with a South African fintech to bring the business rules for 2.4-million customers on to its platform. This will speed up testing the viability of new financial products from a matter of weeks to only two days.

Vaclav Kandrnal, CEO at DecisionRules, notes huge potential in the Southern African market and says the company is looking to expand its business in the region.

“It is vital for us to partner with experienced local software integration specialists that have a deep understanding of the local fintech landscape. By driving adoption of a globally successful credit-decisioning software solution, we also unlock the potential to improve financial inclusion in the region and enhance the delivery of vital financial services within underserved markets.”