Gerald Chappell is co-founder and chief executive of Abound, a London, England, lender that sets loan rates from a borrower's bank transactions as well as the credit file. He started it in February 2020 with Michelle He. Read our review of Abound.
Consulting to Banks at EY and McKinsey
He met his co-founder when both were financial services consultants at EY, where they watched large banks struggle to lend affordably to people outside the prime market. He later became a partner at McKinsey. "We think traditional credit scores are an incredibly noisy way of understanding people's credit and affordability, and effectively exclude people from the fair finance they should get," he told City AM in December 2024.
Pricing Credit for Hidden-Prime Borrowers
He calls Abound's market "hidden prime" borrowers and puts it at 10 million to 15 million people in the UK. "A lot of people talk about the problem being access to credit in the UK. That's not really the problem from my perspective," he said. "The problem is access to the right price credit." He says a book priced on credit scores alone would expect defaults of about 12% a year, against roughly 4% in Abound's loans.
Licensing Render to Other Lenders
Abound also licenses its decisioning to other lenders under the name Render. He told City AM the technology arm made up about 15% of revenue and was growing fast, and that any US launch would need "very good funding in place for it and have a dedicated management team."
