Responsible lending is a journey of continuous improvement, and as the COVID-19 pandemic has reminded us, on a constantly shifting terrain. And from home. Now we’re all doing it from home.
One important aspect of responsible lending is affordability. Affordability assessment requires a reasonable inquiry into the customer’s income and outgoings to understand their ability to meet all the financial obligations they will commit to if they enter into a credit contract. We have solutions to help lenders make reasonable inquiries about a customer’s income and outgoings, however, this post focuses on expense classification.