Prism Data Closes $5M Seed Round as It Leverages Open Banking to Push ‘CashScore’

Jason Rosen

New York-based Prism Data, which leverages open banking data to enable underwriting of cash flows, has raised $5 million in seed funding led by San Francisco-based Obvious Ventures.

New York’s Citi Impact Fund and Los Angeles-based Core Innovation Capital also participated. The funding follows a strategic investment in May by Mountain View, Calif.-based Samsung Next, the Korean electronics giant’s venture arm.

New Credit Approach

In 2021, Prism Data was spun out of Petal, which uses open banking to help card issuers weigh risks, and also issues credit cards in collaboration with WebBank. Petal and Prism Data split Samsung Next’s $35 million investment.

“Open banking creates new possibilities for evaluating creditworthiness,” said Jason Rosen, co-founder and CEO of both Petal and Prism Data. “Prism’s infrastructure transforms that potential into reality, equipping clients with analytical advantages to strengthen their businesses and better serve consumers.” Rosen is a graduate of Harvard Law School.

Open banking mandates force banks and other financial institutions to share customer data with others and third-party service providers. Still lagging Europe, the United States is making some swift moves and the country’s largest banks are expected to meet open banking standards by the end of 2024.

Together with the funding, Prism Data named Ben Donahue, who previously held senior positions at Nova Credit and Atom Finance, as senior sales executive. For over a dozen years, Donahue has worked in sales and product development, with a particular focus on financial institutions.

New ‘CashScore’ Is Key

Prism Data’s core product is CashScore, which is a broader measure of an individual’s financial reputation than a traditional credit score. CashScore assesses a consumer’s credit risk using real-time financial transactions, as opposed to just credit history, and also assesses more data points, such as income, assets, expenses, and financial volatility. The company says CashScore is available for millions of so-called “thin-file” and “no-file” consumers that do not have a traditional credit history.

“As an alternative to traditional credit scoring models, cash-flow underwriting can unlock valuable insights into consumer behavior,” said Jeff Meyers, director of Citi Impact Fund. “Prism’s proprietary algorithm empowers underwriters to make better informed credit decisions by extracting critical information from financial transaction data that helps them determine credit worthiness.”

Prism said it has signed up more than 20 clients and partners, and completed over two dozen pilots with some of the country’s largest banks. Its partners, including Plaid, Provenir and Zoot, have used Prism’s CashScore to offer more than $2 billion in real-world credit.

“Prism Data embodies our philosophy of investing in companies that harness technology to deliver more world-positive products and services,” said Vishal Vasishth, a managing director at Obvious Ventures. “We share their vision for building a more inclusive and efficient financial system that better serves both consumers and lenders.”