Saad Ahmed speaks to Roman Danaev, founder and chief executive officer of new online subprime broker Financible.com, to find out more about the business and what he hopes to achieve.
Financible.com launched as a new motor finance broker in July, with the aim if providing finance to subprime candidates. The online broker uses manual reviews in order to assess potential customers on a wider set of criteria.
Financible.com was launched by Roman Danaev, together with other shareholders, using funds from their businesses. “Myself and other shareholders have several small businesses that generate some income, so we’ve combined everything and invested it into Financible,” Danaev told Motor Finance.
The broker is based purely online, and seeks to offer car loan solutions to UK-based customers with a range of financial histories, even considering those with county court judgements (CCJs) and defaults.
Danaev says his background in finance and a previous business involving used car sales led him to found Financible.com. “Financible came about quite organically,” he says. “We had a website called Cardeck displaying used cars from car dealerships across the UK, and at some point we put in a car finance module which was redirecting the potential leads to one of the online brokers.”
However, customers began to contact Cardeck to raise issues regarding the online brokers. “In most cases their argument was that when they made an application, the broker didn’t call them,” Danaev explains.“Brokers were doing credit search after credit search until one of the lenders would approve the applicant.”
Danaev explains that he found this process to be insufficiently customer-focused, and he concluded that the traditional assessment, based mostly on a credit score, was lacking. “We had the idea of creating something more customer-focused, that would review customers’ financial backgrounds and life situations, rather than just taking the number from the credit report and saying ‘okay, you’re declined or approved’.”
Financible.com touts itself as a fairer broker, claiming it has a more thorough and qualitative process than traditional assessments. Despite being based totally online, and requiring applications to apply through its website, the online broker bases its car finance decisions on manual reviews of applicants. “A customer simply applies online, we manually review their application, and then match their details to the most suitable lenders,” Danaev said.
“The manual review of each application ensures that we help each customer, rather than having a purely technology-driven service which may lead to an automatic decline.”
Danaev told of one customer who, having been denied by previous brokers, was able to get approved through the system Financible.com has in place.
“We had an applicant who is from Nigeria, but he has been in the UK for seven years,” Danaev told us. The applicant reportedly had six years of continuous employment, with an increasing salary, and a good credit report. According to Danaev, “because he doesn’t have a British passport, one of the lenders rejected him straight away.”
Danaev reported that the applicant was able to be matched with a willing lender through Financible.com. “This makes me ask questions. He should have been approved, because everything shows that he’s a good applicant,” Danaev said. “He was willing to put down a deposit of 30% of the car’s value, which also makes me believe he was a genuine candidate.”
While he won’t reveal the full intricacies of the application, Danaev uses the above anecdote to suggest the idea of Financible.com as a fairer alternative to traditional brokers. “Focusing more on reviewing people’s personalities will drastically reduce the credit searches for each person, and will help them to get the car that they want,” he added.
Financible.com markets itself as an option for subprime borrowers, those who have been denied car finance multiple times for reasons such as poor credit or CCJs. The process of manual evaluation seems to lie at the heart of this.
However, as the client base of Financible.com grows, manual reviews may prove increasingly time-consuming and risk becoming unworkable. Danaev’s answer to this is the development of application programming interface (API) integration in order to extract information. “Besides credit scoring, we will have immediate information, as a summary for each applicant in future,” he told us.
Though this is a form of automation, in an apparent shift from the personalised model, Danaev emphasises that “the key is not to allow automatic rejection if someone doesn’t have a ‘perfect’ credit score.”
“We’re developing our own checkboxes, building our modern internal scoring, something that will go beyond this number that is allocated to each person.”
The uncertainty resulting from the impending withdrawal of the UK from the EU may directly affect Financible.com. “One of our developers is European; the first question on that day was about what was going to happen to employment and all the new potential regulations with visas.”
This question has not yet been answered. With Article 50 still lying untriggered, formal negotiations about all aspects of EU disentanglement cannot yet begin. The financial uncertainty resulting from Brexit may also affect the company, but Danaev seemed broadly positive that all issues would be resolved.
“Ultimately, in a year’s time, the economy will be back on track,” Danaev says, “I’m sure they will figure out proper employment visas, exceptions maybe for citizens from Europe, or some process that will make it easier for them to get employment permissions in the UK.”
As Financible.com goes forward, Danaev outlines that it will seek to simplify the UK car finance service. “The UK is a big market to conquer, so we’ve got a lot of plans, a lot of ideas how to make this whole industry and the finance process, easier,” he says. Danaev sees Financible.com as a key driver of changing the way the car finance industry operates.
“The ideal situation would be for a person to apply and for the lenders to fight for these applicants in terms of offering the lowest rate, and better conditions. This is how it is supposed to be, but right now it’s not. Hopefully, this is something we will try to change in future.”