Soon, lenders will have access to a proprietary creditworthiness score thanks to a partnership between Block Inc. and Nova Credit.
About Cash App Score and Nova Credit’s Distribution:
For the first time, Block will allow other lenders to access its Cash App Score. The popular app is teaming up with Nova Credit to distribute this unique metric to clients.
Cash App Scores are cash flow-based credit assessments that include data from across Cash App‘s features, such as spending habits, savings, repayment history, payroll deposits, peer-to-peer transfers, and more. Block also notes that, as opposed to traditional credit scores, Cash App Scores look at broader financial behaviors and signals. Moreover, these scores can reflect changes in near real-time.
On the consumer end, customers can see their Cash App Scores in the app (under the Money Tab) and gain insight into their current standing. According to Block, more than half of customers are already returning to check their scores. Notbaly, app users will be able to set preferences for “whether and how” their Cash App Scores are shared with third parties.
For lenders, they’ll be able to integrate Cash App Scores into their underwriting using Nova Credit’s network. This metric can also be used alongside Nova’s own Cash Atlas.
Block and Nova Credit will share even more about their partnership during the annual Cash Flow Intelligence Summit, set to take place September 10th in New York City.
What They’re Saying:
Discussing the Cash App Score, Block’s Head of Credit and Underwriting Juan Hernandez said, “At Block, we believe people should be able to use their own financial history to unlock opportunity, on their terms. We built Cash App Score to see the financial activity of millions of people the traditional credit system misses, and it’s now the same technology at the center of how we manage credit across Block, where we use it to understand risk in near real-time.”
Hernandez added, “Partnering with Nova Credit lets us put that capability in the hands of lenders through infrastructure they already trust, so more of those consumers can be reached responsibly, while they stay informed and in control of their data.”
Meanwhile, Nova Credit Co-founder and CEO Misha Esipov said of the partnership, “By bringing the Cash App Score into Nova Credit’s Cash Flow Intelligence Platform, we’re giving lenders a unique tool to develop a richer, near real-time view of tens of millions of credit-seeking Americans. Our joint goal is to help Americans put their best financial foot forward, using the apps they already rely on every day.”
My Thoughts:
Apparently I’m not deep enough in the Cash App ecosystem to have a Cash App Score. Nevertheless, I think that this partnership makes a lot of sense for all parties. I also appreciate that customers will seemingly have the ability to dictate whether or not outside lenders can access their scores — although I’d hope that this is an opt-in rather than an opt-out. In my view, for those who may not have established traditional credit, this could be a chance to prove their creditworthiness via other means.
While this sounds good in theory, we’ll need to see how it goes in practice. With that in mind, I look forward to hearing more next week at the Cash Flow Intelligence Summit.
