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Open banking startup Prism Data raises $5m

Open banking startup Prism Data raises $5m

Prism Data, the US open banking outfit that span out from Petal earlier this year, has raised $5 million in seed funding.

The round - which comes just days after the Consumer Financial Protection Bureau released a proposal for open banking in the US - was led by Obvious Ventures, with participation from Citi Impact Fund and Core Innovation Capital.

Set up by credit card outfit Petal in 2021, Prism Data's suite of products — including its proprietary CashScore — enable financial institutions, fintechs and other companies to use open banking analytics and cash flow underwriting to get insights from consumer-permissioned deposit account transaction data.

Prism clients use this to predict credit default risk, score missing- and thin-file customers, identify first-party fraud, and better manage credit risk in their existing portfolios.

The firm claims that rising credit card and loan delinquencies are leading to an increase in demand for its technology, which is likely to rise in the wake of the new CFPB plan. Since its inception, Prism has signed more than 20 clients and partners and completed over two dozen successful pilots.

“Open banking creates new possibilities for evaluating creditworthiness,” says Jason Rosen, CEO, Prism. “Prism’s infrastructure transforms that potential into reality, equipping clients with analytical advantages to strengthen their businesses and better serve consumers."

The company has also hired Ben Donahue as a senior sales executive. He previously served as the head of sales for Nova Credit, and more recently, as the vice-president of sales for Atom Finance.

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