When searching for a loan, today’s consumers like to shop around. In fact, in a recent survey of adults who had applied for a loan in the past 12 months, only 31 percent of the respondents considered their primary bank alone as a possible source. Instead, 70 percent said they researched two or more lenders before making their decision, with online lender comparison websites included in their exploration.
These types of financial comparison resources are plentiful these days. While NerdWallet, Credit Karma, WalletHub, and Bankrate.com are among the better known in the U.S., there are dozens of others as well—with some operated by online lenders themselves and others by nonprofit organizations.
Though the product ranking methods of these sites vary, many allow banks and other lenders to pay a fee for exposure in the form of more prominent placement. On NerdWallet’s website, for example, the advertiser disclosure explains that they are compensated by their “partners,” which “may influence” the products they review and write about as well as “where those products appear on the site.”
Credit Karma’s advertiser disclosure states that the offers that appear on the website “are from third party advertisers from which Credit Karma receives compensation” and that this compensation “may impact how and where products appear” on the website including “the order in which they appear.”
In some circles, this practice of paying for exposure is known as “pay to play,” and only the largest lenders with the biggest advertising budgets can afford it. What this means for the consumers who are relying on these comparison sites to find financial products is that they’re not actually being exposed to all of their potential options. And as a result, they may be missing out on offers from local banks, credit unions, and smaller lenders that could be a better fit for their needs, but that dont’ have the budget or technology to capture their attention.
Enter Konduit. Recently launched by Lend-Grow, an online loan marketplace, Konduit helps banks modernize by leveling the playing field. The platform provides access to the fintechs that consumers want to use, but small and mid sized banks often find difficult – and expensive – to integrate. The fintechs available via Konduit range from lead generators, tech fintechs, data and AI fintechs, and capital sources. Several pre-packaged workflows are also available for banks to get started.
After all, it’s information and convenience that today’s consumers want. Though one recent survey of loan applicants found that a low interest rate was the primary consideration of 36 percent of the respondents, ease of application (27 percent), and fast access to funds (23 percent) were also important factors. Financial technology ( FinTech) is an important component of being able to provide modern consumers the banking experience they’re looking for.