Any person who applies for a loan in a loan company operating outside the banking sector is subject to verification of identity and creditworthiness. Until now, the customer had to make a verification transfer in the amount of PLN 0.01 to a bank account indicated by a financial institution. Such verification could last even several dozen hours, depending on the transfer session.
Currently, some loan companies offer an alternative option of confirming the identity and ability to repay the incurred funds, in the form of an Instantor service, which allows immediate and free analysis of the application submitted by the client.
What is Instantor?
So what is the Instantor algorithm? This is an innovative method by which the customer’s identity and creditworthiness are verified. This is a service provided by the Swedish company Instantor AB, based in Sweden. The product of this company is available in many countries, including: Finland, Sweden, Spain, the Czech Republic, the Netherlands, Denmark, Brazil, Mexico, Great Britain and Croatia. Since 2014 Instantor is also available in Poland.
The service provided by Instantor AB makes it possible to verify the authenticity of the customer’s personal data and to conduct an assessment of his creditworthiness, based on data obtained from his personal account.
How does Instantor work?
This is an immediate verification, allowing for quick identification and obtaining financial data. The service operates based on the so-called screen scraping (literal translation – “scraping the screen”). In practice, this means that you automatically download the history of operations from the client’s personal account from the last twelve months. Then, the algorithm processes the data from the client’s account, and then, on their basis, generates an information report on creditworthiness and confirms the client’s personal data.
However, the customer must first fill out the registration form and confirm his data and log in via a special electronic banking platform, and also enable access to his personal account.
The whole procedure takes place without human assistance, it is processed automatically, and this means that third parties have no access to the customer’s personal data and financial history.
Verification carried out by Instantor is very fast and allows, after performing the automatic verification, to give consent or reject the loan application within a few minutes.
Instantor and the security of personal data
The security of personal data processed by the Instantor is controlled by the Secure Socket Layer (SSL) encryption technology – a protocol used to encrypt network communication. The consent to the processing of data under this service takes place in accordance with art. 31 of the Act of 29 August 1997 on the protection of personal data.
What’s more, this data is not saved or stored by Instantor. The Customer may modify or update the personal information provided at any time. And Instantor, there are no tools to modify any data or even perform operations from a user account. The goals of the Instantor algorithm are only to compare and analyze data regarding the financial situation of the user of the e-banking platform from the last twelve months.
The subject of the Instantor algorithm’s interest is only the history of the bank account for a specific period, which is to be used for the point-based assessment of transaction risk.
Responsibility for the confidentiality of information used during verification using this algorithm rests with the company Instantor AB.
Who in practice uses the Instantor service?
Instantor was created for non-bank institutions, banks and other financial institutions. When granting loans or credits, customer data must always be verified. The Instantor compares and checks personal data and analyzes the client’s financial situation. Within a few minutes, a positive or negative answer will be given regarding the submitted application.
What does the report from the company look like?
The report is a PDF file and is divided into several sections. In the first part, the customer’s personal data is confirmed. However, the most important element is the summary of the bank account details. This section will display the following information:
– the type of currency in which the settlements are made,
– the period of the history of financial transactions that has been analyzed is expressed in months,
– the number of transactions analyzed,
– average of monthly transactions,
– average monthly income on account and expenses,
– average account balance related to the analyzed period,
– total amount of liabilities paid and their amount.
Such a report also includes a summary of the financial flow in the form of a twelve-month balance, the so-called cashflow.
Instantor – does it work?
The Instantor algorithm is considered safe, while the processing of personal data proceeds to the highest standards. This service benefits both financial institutions and consumers. It allows you to save time and reduce the formalities associated with finalizing the transaction to a minimum.
Instantor successfully replaces the verification transfer used so far. It is convenient for companies offering so-called payday loans and installment loans.
The service, prepared by a Swedish company, relieves the client from the obligation to provide various statements, certificates or sureties. It is an extremely useful tool, because it gives the opportunity to get the way of Instantor algorithms to the economic and social environment of a given industry, and even a specific entity. And risk measurement is carried out in several different ways, in line with the expectations and preferences of lenders.
If the client has a savings and settlement account in a bank that does not support the Instantor algorithm, he can not pass the data verification process successfully. In this case, a different checking tool will be used.
The number of companies using this data verification tool increases beyond the Polish borders, hence the conclusion that a similar situation will take place in our country in the near future.