Consumer financial data aggregation as we know it today — collecting hundreds, sometimes thousands of data points on individuals — began as a completely analog process. In the 1950s, FICO set out to create an algorithm that could help lenders quickly understand the creditworthiness of a prospective borrower. Prior to this, the process was lengthy, and businesses took on significant risks. FICO’s compiling of pay stubs, personal references, public records, employment verification, and past payment history on local finances, like department store credit cards, pioneered creditworthiness standardization.

Still informed by the FICO company, today’s credit scores are embodied by the three major credit bureaus. These quasi-governemnt yet private corporations continue to collect information on individual Americans through a proprietary rubric only partially shared with the public.

Modern collection methods have revolutionized data aggregation. Through the use of cookies and screen scraping, purchasing vast amounts of payroll data, and the omnipresent eyes of the internet of things, the major credit bureaus collect, store, and sell personal information on a larger scale than ever before.

However, the legacy consumer finance industry has a data problem; underlying its functions, decisions, and processes is an outdated network of static, analog documentation — things like payslips — designed decades ago for a world that no longer exists.

Argyle is proud to be part of a constellation of open finance, consumer-permissioned data transfer APIs that believe individuals should control the flow of their own information. I’m lucky enough to talk with clients every day that comment on Argyle’s novel approach to income data portability, user-permissioned consent, and consumer privacy.

Through competition and purpose, the fintech industry is developing consumer-centric practices by:

• expanding access to credit beyond traditional credit scores,
• informing the consumer about what information is collected and how it’s used,
• integrating the ability for a user to revoke access to their information (the right to be forgotten),
• and providing consumers with transparency and direct user consent.

Over the last 50 years, the old model compiled data on hundreds of millions of Americans (as the Consumer Financial Protection Bureau recently highlighted) without their knowledge, consent, or ability to revoke access to this information, and they’ve done so within an opaque scoring model that affects every single American.

At Argyle, we think data belongs to the individual that generates it, and I hope you’ll join us in calling for consumer-permissioned open finance.