July 01, 2024

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Payroll data for Fintech industry is pure Gold
Introduction

The financial services industry is evolving with new FinTech companies popping up daily. Many of these companies have been able to leverage new data sources to create insight into their customers' financial habits and ideate better products that meet their needs. 


Payroll data is one such source of information that has become critical for FinTech companies looking to offer lending products or insurance plans. In this article, we will discuss why payroll data is so useful for FinTech companies and how Tartan enables them by providing real-time access to this information. 


What is Payroll Data?

Before we get into what payroll data is and how it can help companies, banks, and Fintech companies, let's first discuss what payroll information is.


Payroll information is the data gathered from payroll systems. This data point gives a complete picture of employment data history, including salary, benefits (such as healthcare coverage or retirement plans), and other types of compensation they receive in exchange for their labor.


Payroll Information – What Can You Learn from It?


Payroll data is a rich source of information for companies. It can be used to determine the creditworthiness of potential customers, understand consumers' financial health, and create insights into spending patterns and real-time income verification.


This data is a reliable source of information that can be used to help keep your business running. It can include real-time information about employees, such as the following:

  • Employment status — whether an individual is working or not

  • Financial health — how much money an individual earns

  • Spending patterns — the amount of money an individual spends each month on groceries and other everyday expenses


With this information, employers can determine if an employee is likely to be reliable or not. For example, if they spend more money each month than they earn, they will likely be unable to pay their bills on time, which could lead to problems in the near future.


Besides the financial information, you can also use this data to get a snapshot of who your employees are. This can help you determine if they are responsible people who will be able to handle their responsibilities on time or if they might need extra training. The 2019 EY Global Payroll Survey examined payroll trends which provided insights into preparing for payroll and understanding the future. 


Can Payroll Data Be Used To Make Better Lending Decisions?


Payroll data can also be used to help companies make better decisions. For example, the use of data has become a significant part of the banking system. Banks have begun using it to understand their customers better, helping them make smarter decisions. In addition, banks can also analyze customer data to determine which credit cards are the most popular among customers with similar profiles. 


Banks can use the data to build algorithms that predict customer behavior and make credit decisions faster. This allows banks to be more competitive as they are better equipped to understand their customers' needs. With the help of a bank API, businesses can integrate financial services into their products.


Financial institutions can use data to build credit risk models to help them make faster and smarter decisions on whether they should lend money to a particular customer. FinTech companies are now trying to tap into this data so that they can help banks do things like build credit risk models.


Insurance companies are also using data to build models that will help them assess the risk of insuring customers. This has led to a lot of innovation in the insurance industry, which is now trying to leverage technology and data science to provide better products and services. They have also begun using customer data to understand their customers better and make smarter decisions about how to price their products. This has helped them improve their bottom line while ensuring they provide the right insurance coverage for each customer.


Tartan is Enabling FinTech Companies to Unlock Untapped Alternative Data


For FinTech companies, payroll data is better than traditional methods, such as credit scores, which rely on historical information rather than current information about the consumer's financial situation. 


Tartan has been involved in this area since it was founded as a provider of alternative sources of consumer credit data. This includes non-traditional forms like payroll and utility payments. Tartan provides FinTech and financial services companies with access to timely, accurate, and compliant payroll data. It offers other value-added services, including fraud detection algorithms and behavioral analytics tools. Additionally, Tartan provides more accurate risk assessments for customers who receive their wages through direct deposit. 


Parting Thoughts

The FinTech industry is a very competitive space, and companies need to stand out from the crowd. One way to do this is by having a strong employee base that is happy with their pay and benefits. Having consistent and accurate payroll data is a great way of doing that. 


About Tartan

Tartan is a company that helps verify an employee’s identity or income level quickly and easily. We help businesses comply with regulations by providing them accurate, reliable information about their customers’ financial status. Our target audiences are financial institutions, who must verify a person's identity or income level before issuing them a credit card or loan. We also work with law enforcement agencies who need access to accurate information about the people they are investigating.

Empowering businesses with API-enabled solutions to build next-generation products.

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©2024 TartanHQ Inc.

Empowering businesses with API-enabled solutions to build next-generation products.

Subscribe to get an update :

©2024 TartanHQ Inc.

Empowering businesses with API-enabled solutions to build next-generation products.

Subscribe to get an update :

©2024 TartanHQ Inc.