Financial data aggregator Plaid created LendScore, its AI-driven credit risk tool, to provide an alternative to the slim view lenders get from traditional credit files.  

AI-driven LendScore is built on cash flow and behavioral data drawn from more than 1 million financial transactions each day across the Plaid network to drive lending decisions, Mitch Cook, head of credit go-to-market, said at Plaid’s Effects conference on May 21.

Rather than scoring repayment history alone, it evaluates income, spending and cash flow stability and how those patterns shift over time, Cook said, adding that the model tends to predict future repayment and borrowing capabilities rather than analyzing the past. 

If income rises while spending stays flat, the score improves, Cook said, adding that unlike traditional credit assessments, there is no penalty for paying off a mortgage early or closing a credit card account. 

“On average, LendScore delivers a 25% lift in predictive performance compared to traditional credit data alone and can reduce risk up to 41% at the same approval rate, all at a lower cost to lenders,” he said. 

The company is working with lenders including Upstart, LendingClub and Rocket Money to deploy the tech within their operations, Cook said. 

Rise of cash flow underwriting 

FIs are increasingly leaning on cash flow-driven underwriting as well as traditional credit metrics to reduce delinquencies, he said. 

According to data analytics company IntelMarket Research, global cash flow underwriting market size was valued at $2.73 billion in 2025 and is expected to jump to $6.43 billion with a compound annual growth rate of 10% by 2034. 

Varo Bank, for example, uses cash flow underwriting for nearly 90% of its originations, according to prior reporting by FinAi News. 

And although the $486 million bank based in San Francisco also uses FICO scores, data on cash flow offers a clearer picture of the borrower, Das Mohandas, former chief lending officer and general manager at Varo, said at Nova Credit’s Cash Flow Underwriting Summit last year. 

HSBC and M&T Bank also use cash flow underwriting to better aid clients. 

Register here for the FinAi Lending Summit, set for Oct. 7-8 in Las Vegas.