Koyo was founded in 2018 with the view that people should be treated fairly when it comes to credit. Their goal is to offer a range of customers good credit options through the use of technology and disrupt the older ways of lending where the outcome was based on data from credit scoring agencies.
Koyo is the UK’s first Open Banking powered lender. Open Banking is a secure way in which they can access transactional banking data to offer credit that is well priced and based on spending habits of their customers, rather than credit.
Open Banking technology is having a big impact on financial services which Koyo hopes will benefit millions of customers in the UK.
Unlike other lenders who use credit agency data, Koyo’s approach enables us to offer competitively priced loans to customers who can’t get credit from other lenders due to their small or non-existent credit rating.
Koyo offer loans between £1,000 and £7,500 with terms up to 60 months. The APRs offered from Koyo is between 19%-39%.
Koyo only lends to customers with supported banks. Their list of supported banks are:
- Bank of Scotland
- First Direct
- Marks & Spencer
- Ulster Bank
- Tesco Bank
- Danske Bank
Koyo’s criteria for loan approval is:
- Be over 21 years old
- Be a UK resident for at least six months
- Not be bankrupt
- Have no CCJs or history of bad credit
- Have a mobile phone
- Receive a regular income
- Not be self-employed
Koyo estimates that it will take three minutes to apply for a personal loan with them and that applying for a loan will not affect the customer’s credit score.
They also have one-day loan approval, which allows them to give a decision on the customer’s application after one full working day. Once the loan has been approved, the money could be in the customer’s account within one working day.
Koyo will ask the customer to log into their bank account, this is because Koyo connects to the customer’s bank account (using an FCA regulated third-party technology provider) to verify the customer’s income and ability to repay the loan.
Koyo does not save or store the customer’s bank login or password. They have no access to the customer’s bank account to make changes or withdraw money and will not have this access at any point.
Koyo does not require any fees, meaning there are no late payment fees and no early repayment fees.
As Koyo uses Open Banking to make decisions on the approval of a customer’s application, the customer does not need a guarantor to get approved for a loan. For this reason, Koyo doesn’t offer guarantor loans.
Koyo also does not offer short-term or payday loans. After the loan is approved, the customer can select their monthly repayment date.
Koyo states that they are focused on changing the loans market for people who are new to the world of credit or may be new to the country. For this reason, customers with a Koyo loan can make additional payments at any time or pay off their loan entirely at no extra cost.
Koyo loans are fully transparent and they don’t charge hidden fees.
A representative example from Koyo is a loan with an amount of £4,000 credit for 36 months. The interest rate for this loan is 24.06% (fixed) with 35 scheduled monthly payments of £157.64 and a final payment of £157.55.
The total amount payable is £5,674.95 with a representative APR of 26.9%.
If the customer has had their loan for six months and paid off over 50% of their outstanding balance, they can borrow more money from Koyo at any point.
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Other Financial Services
Debt Consolidation Loan
A debt consolidation loan allows customers to take out a new loan that they can then use to pay off all their existing credit, leaving them with one payment to make each month.
Koyo’s blog covers all the information a customer could require concerning a debt consolidation loan, such as what they should take into account before getting a loan and how they should get this loan.
Koyo also offers a loan calculator to let their customers see just how much they should borrow and what the terms and interest on this borrowing would be.
Koyo’s blog also includes information on personal finance and a more in-depth explanation of Open Banking so their customers can understand the technology behind their loan and feel at ease with the company.
Koyo Reviews and Ratings
Koyo has received very positive reviews from customers across sites such as Trustpilot, Choose Wisely and Facebook Reviews. The number of reviews left is small in comparison to some other companies, but not so limited that they don’t demonstrate a positive opinion of Koyo’s services.
Koyo has an active Facebook page that is liked by 79 people and is followed by 106 people.
They also have an active Twitter account that is followed by 162 people.
Many customers were happy with the quickness of Koyo’s loans and how fast the money was deposited into their account after their loan was approved, as well as the easiness of the application process and approval process.
Customers were also happy with the service they received from Koyo when they required assistance from the team for their issues.
Some customers were unhappy with the service they received when hoping to get their application approved by Koyo.
Trustpilot – 4.9/5 (Based on 661 reviews)
Choose Wisely – 4.8/5 (Based on 549 reviews)
Facebook Reviews – 5/5 (Based on 6 reviews)
- Open Banking means the approval decision isn’t based on credit
- Fast approval time
- Fast timeline for depositing money into account
- Very positive reviews online
- No hidden fees, early repayment fees or late payment fees
- Not as experienced as other companies
- Limited amount of maximum loan compared to other companies
- Relatively high APR rates compared to other companies
- Doesn’t loan to self-employed individuals
- No other financial services offered
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