If you’re a lender, staying competitive means delivering a faster, more transparent, and customer-friendly experience—without compromising on the accuracy of your credit decisions.

Open banking has the potential to transform how you access financial information and assess financial health, but only if your provider offers the right flexibility, coverage, and features.

If you’re exploring open banking and how it can benefit your lending business, you might be:

• Still relying on paper statements and manual processes for affordability checks, which can slow down the application process.
• Finding that obtaining the complete financial information you need takes too long, delaying credit decisions.
• Struggling with lengthy loan application processes that frustrate customers, leading to abandoned applications and a lack of clarity around their financial situation.
• Offering a below-par customer experience that needs a faster, more streamlined process, that doesn’t rely on third-party services that can dilute your brand.
• Paying high fees for customer repayments cuts into your already tight margins.

In this guide, you’ll learn the full potential of open banking for lenders, and how to find the right open banking platform for you.

We cover:

• The benefits of open banking for lenders
• How to choose the right open banking platform as a lender
• How Yapily can support you as a lender with open banking
• How Yapily supports Yonder to lend to the credit invisible

Are you a lender who is looking for an open banking solution, but don’t know who to work with? You can read a full comparison of open banking solutions, or reach out to one of our open banking experts to find out how Yapily can help.

The benefits of open banking for lenders

Open banking allows lenders, payment service providers (PSPs), fintechs, and other authorised organisations to do two main things:

• Access real-time financial data directly from customers’ bank accounts on transactions, balances, and spending habits.
• Initiate instant payments from one account to another, including recurring payments.

There are obvious reasons why this could be useful for all types of lenders. Firstly, you can get deeper and more accurate insights into your customers’ affordability and creditworthiness. Rather than relying on bank statements or credit scores, you can use the most up-to-date and detailed information available: all obtained through open banking application programming interfaces (APIs).

You can also automate the collection of payments directly from your customer accounts. With open banking, you can bypass card issuers and reduce fees, but you can also make payment collection more reliable. For instance, sweeping variable recurring payments (VRP) can automate the collection of funds for unsecured loans, such as pulling repayments directly from a borrower’s bank account to their loan account.

Even after the lending decision has been made, open banking can be useful. You can see how the loan is being spent. Or if the loan *wasn’t *granted, you can remarket to those customers with more suitable options that meet their specific financial situation.

So, open banking offers you improved credit decisioning and more reliable payments. But it also lets you serve more customers. Consider a self-employed customer who has inconsistent income but can easily afford repayments. With open banking, you can verify whether that customer qualifies based on their bank transactions quickly and discreetly.

Open banking also lets you offer a frictionless experience for customers. They no longer need to print out various documents to use as proof of eligibility, nor do they need to actively manage repayments.

Instead, affordability checks and payment take place through automated connections with their account, via an API. This API requests specific packets of encrypted data from the bank in a secure manner, which doesn’t require the exposure of any customer data.

How to choose the right open banking partner as a lender

Lenders represent a huge range of different institutions, and each lender differs based on who they lend to, their risk appetite, and how they assess their customers.

To find the right open banking solution for you, consider the following:

• What services are you using open banking for—payments, data, or both?

As a lender, you may be most interested in using open banking to make accurate lending decisions, but you may want to use it to collect payments too.

However, one of the key things to know about open banking is that most providers typically focus on either payments or data. They’ll either be a payment initiation service provider (PISP), or an account information service provider (AISP). Very few providers do both equally well.

It’s worth digging deeper into the kinds of services they offer. Do they offer the payment services you need, such as VRP? Do they enrich transaction data into detailed categories? These are the types of considerations you need to take into account before you make a decision.

• Are you serving businesses, consumers, or both?

Usually, open banking platforms connect only with consumer accounts as standard. That’s because it typically requires a separate API to connect with a bank’s business accounts. As such, very few platforms offer business account connectivity.

That means, if you’re looking to do affordability checks for business loans, there are fewer options available. So, make sure you check for business, consumer, and wealth account connectivity.

Do you primarily work with businesses? Find out how open banking can help you: Open banking for business accounts: what you need to know

• Do you want to develop your own user interface or use a hosted page instead?

One thing to look for when choosing an open banking provider is whether they include their own logo throughout the user flow. For some lenders, this can be problematic as it can disorientate customers if they don’t recognise the logo—creating unnecessary friction in the user experience.

Instead, you might want to choose a platform that lets you build the user experience from scratch. By customising the entire flow with your own branding, you can build trust and reduce friction. There are two main options that meet these requirements: a white-label solution or a pre-built hosted flow. Or, you can pick a platform that offers both for greater flexibility.

• What markets are you operating in?

Different platforms have strengths in different markets. This is due to the various bank APIs that a particular platform connects to.

If you’re operating across Europe, you’ll want a platform that has high coverage in that region. The alternative is that you’ll need multiple open banking providers to cover your operations.

In the next section, we want to show you how Yapily could be a good fit for you.

How Yapily can support you as a lender with open banking

At Yapily, we’re an open banking provider offering data and payment services across Europe, including the UK. We’re both an AISP and PISP (meaning we offer both data and payments services) with coverage in 19 countries.

Here are three reasons why, as a lender, you should choose Yapily as your open banking provider.

1. Access data and payment services with extensive European coverage

Typically, open banking solutions excel in *either *payments or data. This means that a typical PISP’s customers have to choose an alternative solution if they need comprehensive AIS services, and vice versa.

At Yapily, we do both—and we have extensive European coverage for payments and data. This means that, as a lender, you can do both the credit decisioning *and *the collection of payments, without having to use an additional provider.

And, even if you don’t want to offer both payments and data immediately, it can be useful to choose a solution that offers both. This way, you can futureproof your service and not have to return to the market if your needs change.

We provide data including the bank name, account balance, account owner, transactions made, and the type of account. And we offer transaction enrichment, including categorisation, via our Yapily Data Plus product.

Additionally, we offer payment types beyond single and scheduled payments, including sweeping and commercial VRP, allowing you to automate loan repayments too.

For both data and payments, we have coverage across 19 European countries, including the UK, the Netherlands, Germany, and France. We connect with nearly 2,000 banks across the continent.

We’re also one of the few platforms with widespread connectivity to consumer, wealth, and business accounts, so you can manage both consumer and business loans with open banking.

2. Fully customise the user experience of your payments or data services

At Yapily, we offer a flexible flow for all types of lenders and their customers. You can choose from two products, which you can adapt to your desired customer experience:

• Our white-label solution. In this case, we provide the payment infrastructure, which can be integrated with any solution or application. You’ll benefit from the possibilities of our API while maintaining complete control over how customers interact with you. This can reduce friction and improve conversions.

• Our hosted solutions. If you don’t have the resources to build the user flow from scratch, you can use our pre-built templates. These will be hosted by us and will include a small Yapily logo. It’s a good option if you need to get started more quickly.

Whether or not you need open banking payments on top of data right away, you’ll have total access to Yapily’s payment and data services whenever you need it.

3. Rely on enterprise-ready infrastructure that’s compatible with business accounts

As a lender, you need an open banking API you can depend on. But the reality is, not all platforms can keep up. Under heavy demand, some slow down—or worse, crash—leaving you and your customers in a bind.

Yapily’s API is built for scale. Designed to handle high volumes of data requests without breaking a sweat, it’s suited to lenders of all sizes — from global corporates to growing SMEs. Tested with real consumer and business accounts, our API consistently delivers industry-leading uptime, ensuring your operations run smoothly at all times and no matter the volume.

As with all financial services, data security is non-negotiable in the lending space. Yapily’s API is ISO 27001 certified, fully GDPR-compliant, and meets PSD2 standards. That means you can trust us to safeguard your customers’ data while staying ahead of regulatory requirements.

But here’s what truly sets Yapily apart: we’re one of the few platforms with widespread connectivity to consumer, wealth, and business accounts. This gives you the power to manage both personal and business loans through open banking, unlocking new possibilities for your lending portfolio to deliver a competitive edge.

How Yapily supports Yonder to lend to the credit invisible

Yonder is a fintech that was built to serve the “credit invisible”, namely those people who don’t have access to credit or can only access credit with low limits. As many as five million people in the UK have little to no credit history, meaning they can’t access loans.

To provide credit to these people—and to boost financial inclusion—Yonder has turned to open banking. With the customer’s consent, Yapily Data allows Yonder to access real-time bank account information—including balances and transaction data—to create a credit profile instead of a conventional credit history.

As a result, Yonder offers its customers as much as three times what they’d be able to access via conventional lenders—and at a lower rate. It helps customers access funds, without unaffordable debt cycles.

Plus, Yonder offers customers the chance to simplify repayments, via Yapily Payments. This has resulted in fewer late payments.

Now, over half of Yonder customers are using open banking to pay their balance—and more than £3.5 million has been made via Yapily Payments. What’s more, 23% of Yonder’s customers are accessing credit for the first time.

Read the full case study: How Yonder + Yapily are making credit more inclusive

Yapily: The ideal open banking solution for lenders

In this guide, we’ve shared what you can do with open banking as a lender. Alongside accessing deeper data on your transactions, you can automate account-to-account payments for more reliable loan repayments.

Ready to get started? Reach out to us at Yapily.