AI powered transaction analytics firm, Fuse, has launched a new product, Health Signals, to help risk and compliance teams to measure financial vulnerability, predict arrears risk, and monitor the impact of financial products on their customers.

This product will provide lenders with compliance support as 55% of lenders admit to being unprepared for the upcoming Consumer Duty, while 61% say they’ll have to bring in a third party to provide support and guidance.

Health Signals automates vulnerability monitoring by analysing customer transaction data (via Open Banking or existing transaction data) and providing institutions with the insights needed to proactively monitor, report, and predict financial vulnerability.

This empowers firms to ensure better treatment of vulnerable customers and provide rapid support to those at risk of falling into arrears, which is particularly important when considering nearly a third of lenders (32%) have seen an increase in customers defaulting on their payments in the last 12 months, with a similar proportion (29%) reporting an uptick in the number of borrowers asking for support.

To support firms with vulnerability detection, Health Signals assigns customers with a Vulnerability Score, which takes into consideration their level of vulnerability and likelihood to enter financial harm. The scores are ranked in priority of those who are most in need of intervention, allowing firms to see in one glance which of their customers are most in need of support.

Fuse is working with leading high-street banks to implement the Health Signals solution in preparation for the upcoming regulation deadline.

Sho Sugihara, CEO of Fuse, said: “The UK financial system is in urgent need of systematic change if the financial health of consumers is to be at its heart. The Consumer Duty stands to be a powerful catalyst to kickstart this change, and it’s essential that banks and other financial institutions are well supported with the technology and expertise needed to adapt successfully to the new regulations.

“Health Signals offers unique insights into consumer vulnerability, providing firms with the tools needed to better understand their customers and boost consumer protection. We’ve developed Health Signals in collaboration with some of the UK’s most recognisable banks, ensuring the platform proactively monitors the impact of financial products. This approach represents the future of global finance, and offers unparalleled consumer protections whilst unlocking access to more affordable financial products, and building a fairer financial system for millions across the UK.”