What if a magazine subscription—say, to Fortune—helped you get a loan?
Tanyapong Thamavaranukupt, co-president of Thai fintech Ascend Money, sees spending patterns—like magazine subscriptions or mobile bills—as a signal of creditworthiness, particularly in markets like Southeast Asia which have both a large underbanked population and underdeveloped financial institutions.
“We don’t rely on traditional data to make our loan decisions,” he told Fortune. Instead, Ascend Money’s lending service, Ascend Nano, relies on data from the company’s digital wallet, a service used to store and transact money, and make payments. “We can see what types of transactions users make, where they use their money, the type of phone they’re using,” he explains.
That can build a risk profile of a customer that doesn’t rely on traditional evidence, like financial statements, payslips, or a credit bureau assessment. Take a magazine subscription: Tanyapong suggests that a user who regularly reads a publication might be slightly more educated, and so may have a higher income–and so may be a safer person for Ascend to lend to.
Tanyapong reckons that about 20 million Thais, out of a larger population of 70 million, should be able to access a loan. Yet the country’s formal banks are only lending to about 5 million customers. That leaves around 15 million Thais who can’t get access to financing even though they may be creditworthy. “It’s not because they’re not qualified,” Tanyapong says. “It’s simply because the traditional players … use the exact same model that’s been there for the last 30 years.”
