technical steps of building a credit risk engine

He claims that Stilt has helped immigrants generate $200 million in lifetime income. “The initial numbers were really small, but the impact has been material.” “In terms of multiples for growth, it is at 1000x since launch,” he says. When asked about the kind of growth they have seen with Stilt, Mittal emphasises that they started very small. The last piece of the puzzle was their immigration status in the US – what type of visa were they on? How long were they likely to stay?Īll of this alternative data is put to use to make predictions on the potential credit risk of individuals, based on which the company decides how much money it can loan and at what rates. They used transactions from customer bank statements around education and employment as well as qualifications and educational history to gather sufficient data. To build a credit score that works in favour of immigrants from scratch, Mittal says they needed “alternative” data – which led them to bank statements. Over the last six years, the company has managed to raise more than $357 million in debt and equity fundraising – disbursing “hundreds of millions” of dollars in loans to “tens of thousands” of immigrants. The pair pooled their savings and started lending their own funds to strangers on the internet using their own risk models. They started off by building a credit score service for international students, with a view to sell the product to other institutions.Ĭhanging tack, they decided to start their own company. “We wanted to solve the problem we both faced when we moved to the US – access to better credit products for immigrants including credit cards and loans,” Mittal explains. Years later, Mittal would go on to start a project with Singh, which has now evolved into Stilt. “And that meant I was sleeping on someone else’s couch for a little while.”Įventually, he found a roommate, Priyank Singh, who offered him a room without asking for anything else. “Every landlord that I went to was asking me for a credit report, a co-signer or a deposit, and I had none of those things,” he tells FinTech Futures. As an Indian abroad, he found it difficult to rent an apartment for himself. Rohit Mittal moved to the US over a decade ago as an international student at Columbia University. With the fintech boom, a number of start-ups have looked to solve this problem, and Stilt – built by immigrants and backed by Y Combinator – is one such company.

In particular, many immigrants can find themselves struggling to access credit products in the country due to having little to no credit history. Priyank Singh and Rohit Mittal, co-founders of Stilt

Technical steps of building a credit risk engine