TSB has partnered with start-up LOQBOX to provide customers with alternative options to build their credit history by saving rather than spending.
Customers will be able to select a certain amount each month – between £20 to £500 – that they want to save over the course of a year.
They can then purchase a LOQBOX digital savings voucher worth 12 times the amount that they commit to saving each month.
Instead of buying the voucher outright, the customer uses 12-month, interest-free finance to purchase it.
The monthly payments for LOQBOX – which are equal to the monthly savings commitment – are reported to the three main UK credit reference agencies, whereby lenders can see that the customer is a responsible borrower who can manage credit.
At the end of the 12-month period, the customer receives their lump sum of savings and has built up a strong credit history.
Jatin Patel, product director at TSB, said: “At TSB, we’re always looking at solutions that help bring more competition to UK banking and ultimately make banking better for all UK consumers, so when [we were presented with] what LOQBOX had to offer, we knew we wanted to be a part of it.
“LOQBOX’s solution will improve financial inclusion for a number of people.”
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