US-based fintech Array has launched a new private-label instalment loan product, called BuildCredit Loan, which can be embedded into the company’s ecosystem. 

The credit offering is a turn-key solution aimed at financial institutions, digital brands and fintechs to enable customers to build a credit score.

BuildCredit Loan works by holding loaned funds as collateral, and payments are reported to the credit bureaus as an instalment account.

Once repaid, the loan proceeds are returned to the customer. The proceeds can also be disbursed into other products offered by Array’s clients such as a secured card or new account.

Array will be responsible for managing the licensing, regulatory compliance, underwriting, approval process, privacy, identity verification and reporting. 

An accredited bank will originate BuildCredit loans, which will be serviced by BuildCredit LLC, a wholly-owned subsidiary of Array.

Array CEO and co-founder Martin Toha said: “Millions of consumers each year enrol in high-cost financial services as a result of not having a credit history or a financeable credit score. 

“It is a compelling alternative to high-interest loan products and BuildCredit Loan takes the majority of the complexity out of the offering because we offer it as an end-to-end service.”

The loan product, which is currently in a private Alpha phase, is part of Array financial innovation platform, and it can be integrated with other Array’s offerings. 

Array general manager Darryl Eaton said: “Credit-builder loans are growing fast in popularity, but the considerable internal development time and resources have prevented many banks and digital brands from moving forward.

“BuildCredit Loan is an ideal solution for many companies because they can count on the expertise of BuildCredit and Array to manage the infrastructure, compliance and servicing while the company focuses on providing a seamless digital experience and extending the value they offer to their customers.”