Rental data: Expanding financial access and inclusion

Despite new technologies and widespread innovation in financial services, there are still a lot of people who are ‘underserved’. Lenders and society alike could be missing out on a huge opportunity if this population continues to be overlooked.

For the economy to thrive, we must have appropriate, affordable financial services available to the majority of people – in other words, we need financial inclusion. However, many financial services have historically only been available to individuals with full payment history and ‘thicker’ files, leaving too many consumers unbanked and financially excluded.

Rental data

Rental data could help social housing tenants buy their own home

Making financial inclusion a reality

While social housing tenants may not have accounts at formal institutions or mortgage payments to make each month, the vast majority meet their regular rental payment commitments¹. These payments are usually the largest nondiscretionary outgoing for tenants, so utilising this added insight into affordability and track record is essential when evaluating them for your products and services.

Rental data can help underserved social housing tenants to access mainstream financial services that are safe, secure, convenient and affordable. For credit providers to lend responsibly, as well as prevent fraud, you need the most comprehensive view of a customer’s financial commitments, and rental payment data is a big part of this.

Aspirational futures

Our recent survey among social housing tenants in the UK reveals aspirations towards home ownership, with almost a third (29 per cent) hoping to move onto the property ladder to buy their own home in the future².

This ambition was found primarily among the young, with more than half (55 per cent) of those aged 18-34 years hoping to one day get on the property ladder. Tenants living in London (30 per cent) and the South East (33 per cent) appear to have the highest numbers aspiring to own their own property.

Un-tapped potential

To understand that so many social housing tenants aspire to own a home is to recognise the emergent dynamism of this consumer group and the extent of the ambition that many have. This doesn’t just mean mortgages in order to buy that first property, but all the purchases that go alongside. From staples like gas and electricity provision, to internet subscription and TV packages, to home improvements and holidays. These are things many of us take for granted, but for many social housing tenants financial inclusion can provide better rates, greater facilities and an improved quality of life.

For credit providers, these figures present a huge opportunity. The implication is that there are savvy, young and aspirational people living in affordable social housing. If you are able to include this group in your customer base today, you are far more likely to enjoy their custom into the future when their aspirations come to fruition
and they become more financially independent.

More on The Rental Exchange

The Rental Exchange makes the largest and most essential financial commitment for this dynamic portion of consumers – their rent payment – available for credit providers to use in customer acquisition and in customer management. By providing organisations with rental data (the same level of insightful payment history and payment commitment data on renters) and mortgage holders alike, will enable a level playing field for consumers. Visit our site to find out more>>

1Reviewing the Journey so far, Experian’s analysis of c.162,000 tenants showed that 72% had no significant arrears on their payment record
2The Social Housing Tenants Study 2014 was conducted among more than 1,000 social housing tenants in the UK by The Rental Exchange, a partnership between Experian and Big Issue Invest, the investment arm of The Big Issue.