Credit Scores vs Bank Data: Why Lenders Are Switching

Cash flow underwriting, explainable AI, and credit risk analytics are changing how lenders approve borrowers and set loan terms. Tedd Huff, CEO of fintech advisory firm Voalyre and founder of Fintech Confidential, sits down with Jamie Twiss, CEO of Carrington Labs, and Kasey Kaplan, Chief Product and Commercial Officer, to break down how behavioral signals in bank transaction data outperform traditional credit scores.Over 50 percent of loan applicants cannot produce a reliable credit score, leaving self-employed workers, gig earners, and younger borrowers locked out of the system. Carrington Labs uses billions of lines of transaction data to build personalized, explainable machine learning models per lender, per product, and per customer segment. The conversation covers their "control point" approach to AI, lifecycle underwriting beyond origination, open banking friction in the US, and a five-year outlook on embedded, agent-driven lending.FIND OUT MORE1️⃣ Map analytics to every step of your lending funnel to find exactly where borrowers drop off and why.2️⃣ Buy best-of-breed origination and servicing tools instead of building proprietary underwriting tech in-house.3️⃣ Start with off-the-shelf models, lend small, collect performance signal, then shift to custom models fast.4️⃣ Offer higher loan limits to borrowers who sync more accounts through open banking.5️⃣ Track how borrowers respond to financial scarcity and build those behavioral patterns into your credit criteria.GuestJamie Twiss LinkedIn: https://www.linkedin.com/in/james-twiss/Kasey Kaplan LinkedIn: https://www.linkedin.com/in/kaseykaplan/CompanyCarrington Labs: https://www.carringtonlabs.com/Carrington Labs LinkedIn: https://www.linkedin.com/company/carringtonlabs/Beforepay Group: https://www.beforepaygroup.comFintech ConfidentialPodcast: https://fintechconfidential.com/listenNotifications: https://fintechconfidential.com/accessLinkedIn: https://www.linkedin.com/company/fintechconfidentialX: https://x.com/FTconfidentialInstagram: https://www.instagram.com/fintechconfidentialFacebook: https://www.facebook.com/fintechconfidentialAbout the GuestsJamie Twiss is CEO of Carrington Labs and Beforepay Group. He began his career at McKinsey & Company, held senior banking roles including Chief Data Officer at a major Australian bank, and now leads the development of explainable AI credit risk models for lenders globally.Kasey Kaplan is Chief Product and Commercial Officer at Carrington Labs. With over 15 years across payments, program management, and fintech lending, he leads commercial execution across credit risk scoring, cash flow underwriting, and loan limit solutions.About the CompanyCarrington Labs is the AI and enterprise software division of ASX-listed Beforepay Group. The company builds explainable AI credit risk scoring, cash flow underwriting, and loan limit solutions for banks and non-bank lenders worldwide, having powered over 4 million loans through its sister business.About the HostTedd Huff, CEO of fintech advisory firm Voalyre and founder of Fintech Confidential. With 25+ years in fintech and payments, he brings entertaining and informative conversations focused on the people, tech, and companies that change how you pay and get paid.DD3 MediaFintech Confidential is a production of DD3 Media, a media creation, management, and production company delivering engaging fintech content globally.Chapters00:00 Episode Highlights01:04 Welcome to Fintech Confidential01:13 DFNS: Wallets as a Service (sponsor)02:34 Meet Carrington Labs04:48 Casey FinTech Origin06:05 Jamie Credit Risk Path07:59 Mission Beyond Scores10:16 Cashflow Underwriting13:35 Alternative Data Behaviors17:37 Built Inside Beforepay21:01 AI Control Points24:07 Deterministic Vs Inference28:35 Keeping Bias Out34:48 Real Client Turnaround36:44 Funnel Friction Signals38:25 Optimizing Drop Off39:21 Sky Flow: Building Fast and Secure (sponsor)40:21 Product Specific Risk Models42:32 From Shelf To Custom43:34 Model Retraining Workflow47:05 Siloed Versus Consortium48:59 Cashflow Behavior Insights50:25 Feature Engineering Matters51:41 Macro Shocks In Data56:07 Lifecycle Servicing Signals57:36 Limit Management Uplift58:55 Open Banking Pushback01:03:53 Crystal Ball AI Lending01:09:11 Advice And Wrap Up01:13:24 Hawk AI: Realtime Fraud Monitoring (sponsor)01:14:10 Disclaimer