Globalization has created world citizens – people who cross borders and move to new countries for school or work, or simply choose to call a new place home. For people moving to the United States, this flexibility comes with huge challenges when it comes to simple tasks like getting a credit card.
“When we started the business, we had people from Australia who had top-notch jobs at home and earned great salaries, but they didn’t have access to quality credit products and that didn’t ‘made no sense’, Towers Wilen, co. -Founder of Sable, recently told PYMNTS in an interview.
He said that from a credit standpoint, most traditional banks or lending institutions look at the usual data points, like FICO scores, when underwriting – which is a problem because that data doesn’t exist. for people new to the United States.
Wilen said the neobank was born out of the hardships he and his (all international) co-founders experienced when they moved to the United States, including difficulties accessing bank accounts and credit cards or just simple daily activities, such as receiving wages. or renting apartments, which is almost impossible to achieve without a Social Security Number (SSN) or a credit history in the United States.
This led to the launch of Sable in 2019, which offers citizens of the world moving to the United States a one-stop-shop for checking and credit accounts. With just a government ID and visa as proof of legal status, individuals can be integrated, start building their credit scores, and obtain unsecured credit in as little as four months – the fastest time on the planet. market today, according to Wilen.
Customers must achieve clear milestones set by the company to increase the likelihood and speed of becoming insecure. Those who are eligible for “graduation” are notified through the app each month, when they receive 100% of their funds secured as a credit balance, with no credit check or impact on their credit score.
Venture into cross-border remittances
In August, the New York-based FinTech platform announced a new integration with Wise (formerly Transferwise) that will allow customers to transfer money abroad directly through Sable at rates faster and cheaper than any another transfer alternative on the market.
Wilen noted that historically, international money transfers have been “expensive, non-transparent, full of hidden charges, and most importantly, very slow,” which were some of the problems the neobank sought to address. And among the various providers of money transfer solutions and money transfer services, Wise has best shared its values for transparent, smooth and effortless products.
Wilen said the partnership has guaranteed the “cheapest international money transfer solution in the United States.” The company is so confident in the affordability of the product that it offers to cover the cost difference if customers find better transfer rates elsewhere.
Since signing the deal, Wilen said there has been a significant increase in Sable’s international base, from six-figure revenue to millions of dollars in the first week of launch. This has placed partnerships at the heart of the company’s growth as it assesses potential partners along the customer experience journey, such as loan and test preparation providers in the case of students and businesses. relocation for expatriates and working professionals.
Wilen said the company is starting to move beyond its niche market of international students and professionals moving to the United States, to include new and unexpected clientele such as U.S. citizens and state-based minority communities. – United in the search for efficient means, of quality and of credit. These new clients showed keen interest in Sable’s business, leading the startup to shift its mission of serving internationals and focus more on building a high-end global financial platform “based on inclusiveness, l ‘accessibility and simplicity’.
Be transparent, think rationally
This is also the main reason for the neobank’s decision to make credit one of its main areas of focus, Wilen said, given that the credit market has long been shrouded in secrecy and requires time for traditional bank customers to have access to unsecured credit.
In addition, the credit journey is like a “black box” during this waiting period, with consumers not knowing what to do, how long it will take, and what the requirements are for not being guaranteed. “Why does it have to be so transparent, and why can’t you just tell people what to do to get what they want?” Wilen asked traditional banks engaged in these non-transparent and secretive measures.
He added that over time, companies like cross-border startup Nova Credit have sprung up, translating international credit data into an equivalent US score that underwriters can easily use to assess product applications from. credit. Sable’s international partners have also helped the company take out and provide a growing number of individuals with access to credit.
It suffices to do away with the old way of assessing risk and thinking rationally, Wilen explained, to determine that a non-U.S. Citizen attending a prestigious university or working at a top-tier company is potentially creditworthy and would be a excellent customer.
He noted that companies like American Express, where he previously worked in business development and partnerships, are looking at the space differently and partnering with companies like Nova Credit. That said, changing traditional approaches can be difficult for large institutions, given their corporate politics and risk aversion.
That’s why FinTechs and tech companies like Sable have the ability to act more agile and faster in assessing individuals in different ways, noted Wilen.
Loans, rewards and benefits
Considering the trillion dollar student loan market in the United States, Wilen said the loan market is promising and Sable will look to partner with companies in this space that offer transparent and efficient products similar to those. offered by Wise in the area of remittances.
He said it comes down to feeling comfortable with the risk, which he admitted is much less for a credit card than a huge student loan. That said, getting into that space is always close at hand: “We already figured out how to accurately assess these people, and we’re improving over time in the credit card space,” he said. note. “Once we are comfortable [there], we can also expand into the lending space.
The company also has ideas for reinventing the rewards and benefits game, combining it with building credit in addition to payment products over time and simplifying complex topics related to investing, savings and budgeting.
As FinTechs and traditional banks double their efforts to go digital, Wilen said it’s important to have differentiated offerings that deliver a modern approach to global payments. Overall, he explained, “We want to help people build their credit, and we want it to be an easy and enjoyable experience, not a painful one. […] so that it can be a product as high end as anything else. “