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Overview

The lack of a U.S. credit history keeps millions of immigrants in the United States from realizing their dreams. The Nova team, which comes from all over the world, has experienced firsthand the challenge of not having a credit history in America, which can prevent access to housing and credit. Nova provides a solution that enables immigrants to share their credit history from their home country with financial service providers and others.

Their Story

Nicky Goulimis had excellent credit living in the United Kingdom, but when she came to the U.S. for graduate school, she found herself constantly turned down for credit cards and other services requiring U.S. credit history. Goulimis’ problem was hardly unique. The U.S. is home to 42 million immigrants, with an estimated ten million of them having immigrated in the last three to five years, according to State Department data. For those millions, no option has existed to help transfer credit history from their home country to the U.S., making getting access to basic financial services a logistical nightmare.

While studying in the MBA program at Stanford, Goulimis met Misha Esipov and Loek Janssen, also students at the time. Together the three talked with other international students at Stanford to figure out if they were experiencing similar challenges. “Half of the student body is international, and 100 percent of that half will tell you they can’t get a credit card or a student loan. They can’t get a cell phone. They can’t rent an apartment,” says Esipov. “There’s clearly a broken system.”

With no existing agency able to translate credit history from other countries so that it’s meaningful to U.S. lenders and financial institutions, millions of immigrants face financial barriers that only further complicate their lives in a new country. Esipov, who emigrated from the Soviet Union with his parents and Janssen, who came from The Netherlands to the U.S. for graduate school, were both familiar with the financial limitations imposed on immigrants. For example, credit card applicants without U.S. credit history are required to start from scratch – first getting a secured credit card that requires an up-front deposit, which also comes with major borrowing limitations. Getting loans for international students to help pay off tuition is also a notoriously challenging hurdle, forcing many to either pay out-of-pocket or figure out how to get a loan from their home country. And in the world of property management, it’s common for an applicant to be asked to put down a six to 12-month deposit in the absence of rental history. “You just moved here, and you have to put down an extra $10,000 to $20,000 to find a place to live,” says Esipov. “That’s something that technology and better information can solve.”

Goulimis and her co-founders wanted to create the ability for people to move anywhere in the world and take their financial history with them. She and her co-founders decided it was time to figure out a solution. “It felt like one of those obvious problems with an obvious solution, so it inevitably turned out to be very challenging,” she says. “We were these ridiculous grad students who thought we would simply go around the world and collect the data from overseas credit bureaus. Blind optimism at the time has led us to where we are.”

In 2015, they created Nova. To get the idea off the ground, the three founders needed to partner with overseas financial institutions and regulators, effectively building a global business before they even became a domestic one. This meant they had to not only figure out a way to gain access to credit bureau data from across the globe, but also how to standardize it to be compliant with U.S. financial institutions.

Processing data from around the world so that it’s compared apples to apples instead of apples to oranges has been one of the biggest challenges facing Nova. At the heart of the business, says Esipov, is an International Credit Passport. “We are creating a central repository for global citizens to build and store their financial identity,” he says.

Getting there has required a complicated and ever-evolving set of algorithms designed to standardize data points so they fit a U.S. regulatory model. For example, some countries include gender and age information in their credit reporting, but U.S. regulations restrict credit bureaus from including age and gender on credit reports. Nova had to build a data mapping system that ensured data was filtered out when aggregating information. “We receive data from overseas credit bureaus and we instantly process it and turn it into something that is standard, secure and compliant,” says Goulimis.

Janssen, who was a graduate student at the Institute of Computational Mathematics and Engineering when he teamed up with Goulimis and Esipov, both studying in the MBA program at Stanford, set about building a global technology system for cross-border credit reporting. “My first mission was to create the prototype for one central dashboard where someone, for example, from Mexico, could go on and say: ‘I want my data transported to the U.S.,’” says Janssen. “That global data infrastructure is incredibly difficult to build out, but it is the heart of Nova’s capabilities.”

Nova first started with two countries – Mexico and India – working to create a data engineering system that could automatically translate credit history reports from those two countries into a standard credit report that would work in the U.S. Today the company has integrations into the largest countries that send immigrants to the U.S. and is constantly working to expand its coverages.

Nova imports credit data, buying it for local rates and charging end users, or lenders, a premium for that information. “Different countries have different reporting standards, but the core of what they capture is substantially the same,” says Esipov. “We map the information we receive onto Nova’s proprietary global data dictionary. That enables an Indian credit report to look like a Mexican report to look like a traditional U.S. report.”

Working with CFSI has given Nova a chance to access fintech startups working on similar challenges facing underbanked consumers in the U.S. “We are a company that cares deeply about our social impact, both in terms of the immigrants that we serve, and in terms of the way that we build our business. CFSI has helped us reinforce our values and make our appeal as broad as possible,” says Goulimis. What’s more, having the resources and support of an institution like CFSI has helped Nova get past what others have previously seen as insurmountable barriers to entry. “Building a business like ours –with its inherent complexity of partnering with the largest financial and regulatory institutions in the world – really does take a village, and CFSI really has provided that village of mentors and gurus,” says Goulimis.

What They Do

Key People

Misha Esipov

Co-Founder & CEO

Nicky Goulimis

Co-Founder & COO

Location

San Francisco, CA

2017 Challenge Winner
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