Profits with Purpose: Unlocking Opportunity in Financial Services

Mack Wallace, AVP, Product & Head of Financial Products, MPOWER Financing

Mack Wallace, AVP, Product & Head of Financial Products, MPOWER Financing

Over 45 million Americans are considered “credit invisible,” while another 22 percent are deemed unscorable due to thin, stale, or nonexistent credit files. For these individuals, navigating the financial system becomes a persistent hurdle. Without a prime credit score—a category that only 53% of U.S. adults meet— they face higher borrowing costs or outright denials. This inefficiency doesn’t merely reflect consumer struggles; it represents a significant market inefficiency. When financial providers rely on incomplete information, they often overestimate risk. This leads to higher costs for consumers and missed opportunities for businesses. However, traditional perspectives have long framed financial access as a trade-off between equity and profitability—a dichotomy that is no longer valid. When thoughtfully executed, unlocking greater opportunity isn’t just an ethical choice it’s a sound business strategy

Consider the economic impact — U.S. households spent a record $415 billion on financial fees and interest in 2023, with financially vulnerable households paying disproportionately higher amounts. Yet, these same populations represent untapped potential. For instance, CFPB data shows this potential, revealing that consumers with positive cash flow profiles—even at lower credit scores—are 20 percent less risky than peers with similar credit scores but weaker cash flow.At MPOWER Financing, we have seen firsthand how innovative approaches can unlock this potential. By focusing on future earning potential rather than traditional credit histories or economic background, we’ve supported nearly 20,000 international students from underserved backgrounds. Many of these students have gone on to transform their lives, with average postgraduation household incomes increasing 15 times, benefiting both the students and their families. Addressing these gaps isn’t charity; it’s smart economics. It reduces inefficiencies, broadens markets and builds resilience into the financial system. As climate risks, income volatility and systemic inequities continue to grow, rethinking our approach to create better outcomes for both customers and business is no longer optional —it’s imperative.

Unlocking Opportunity as Competitive Advantage

For too long, the narrative has persisted that financial access and unlocking opportunity for more people is a noble but costly endeavor, leading many institutions to treat it as a separate line of business or a corporate social responsibility initiative. Yet, doing good is not a trade-off—it’s a competitive advantage. Customer trust, built on fairness and transparency, is a cornerstone of both customer acquisition and long-term retention. When customers feel that pricing, account management and financial decisions made about them are fair, transparent and equitable, they are more likely to stay loyal and recommend a provider to others. For example, the Aspen Institute’s Financial Security Program highlights how reimagining business models can align financial provider’s incentives with improved customer outcomes, ultimately benefiting both parties.

One way to unlock greater economic opportunity and customer trust is through the use of alternative data in financial services, including credit underwriting and banking. For decades, traditional banking and credit scoring systems have excluded millions of Americans who lack sufficient credit histories. Research from organizations like FinRegLab have demonstrated that integrating new data sources, such as cash flow or rent payments, into financial decisions by providers can help better assess risk and enable more people to use these financial products responsibly. This approach improves both financial access and business performance—a win for both consumers and businesses.

“Financial institutions that innovate to expand access and inclusion can unlock new revenue streams, build resilience and strengthen customer trust—proving that profitability and social impact go hand in hand.”

AI-driven personalization offers another promising avenue. By tailoring financial products to the specific needs of new or underserved groups, financial providers can enhance customer satisfaction while expanding market reach. Community partnerships also play a vital role, particularly in engaging populations that may be wary of or distrust traditional institutions. Collaborations with local organizations can help build credibility and create channels for financial education and product delivery.

MPOWER Financing exemplifies this framework. By focusing on future earning potential instead of traditional credit histories, MPOWER has enabled thousands of students to access education, unlocking opportunities for both individual success and broader economic growth.

Enabling Long-Term Growth & Profitability

A focus on unlocking economic and financial opportunities for customers is not just about immediate benefits; it also positions institutions for sustainable, long-term growth. The $415 billion spent by U.S. households on financial fees and interest highlights the vast market opportunity in the consumer finance sector alone. Institutions that innovate to meet these needs can open new revenue streams while reducing inefficiencies.

The business case extends to brand reputation too. Consumers increasingly seek ethical finance providers that prioritize fairness and transparency. Institutions that lead in these areas can build long-term loyalty and differentiate themselves in competitive markets.

Looking ahead, regulatory trends and market dynamics will continue to drive businesses to elevate their standards.. UDAAP supervision and enforcement and consumer advocacy are driving expectations for transparency and honest business practices. At the same time, the growing urgency to address systemic inequities—such as those outlined in the National Strategy for Financial Inclusion— offers a roadmap for aligning public and private goals.

Other industries offer valuable lessons. In healthcare, inclusive practices have improved patient outcomes while reducing costs. In tech, companies embracing accessibility and expanding digital connectivity have expanded their user bases and driven innovation. Financial services are no different—institutions prioritizing inclusion today will thrive in tomorrow’s evolving landscape.

A Vision for Inclusive Growth

Unlocking opportunity through financial access, inclusion and fairness is not a competing priority with business profitability or performance—they are mutually reinforcing goals. Financial institutions that embrace this reality can expand into new markets while building resilience and trust in their business models.

As we stand at the intersection of innovation and responsibility, this is a moment for financial leaders to act. By designing financial products with opportunity, inclusion and fairness at their core, we can create an economy and financial system that works better for everyone.