The principles of Forward Flow v2.0 are powerfully demonstrated through the UniCredit/Banxware collaboration. This setup uses UniCredit's banking license to enable Banxware to originate loans (Originate & Keep setup) on behalf of UniCredit, using UniCredit's onboarding and credit policies and strictly adhering to pre-agreed eligibility criteria. The resulting loans are immediately recorded on UniCredit NV/SA's balance sheet. This proprietary model provides Banxware with pay-as-you-go, flexible liquidity, reinforcing Banxware's embedded lending capabilities with instant origination capabilities and scalable funding.
Key Takeaways: Model Features
This model uses technology to create an automated origination & loan book growth engine:
> Fast & Flexible Funding: Instant financing with automated daily data exchange. You pay only for actual exposure; no non-utilisation fees.
> Scalability: Facilitates growth by originating loans which are immediately recorded on the bank's balance sheet.
> Certainty & Transparency: Eligibility, onboarding, and credit rules are defined in advance, guaranteeing a compliant loan book building.
> Risk Management: The lender manages credit and fraud risk and is required to buy back defaulted loans (90 DPD). A cash collateral (calculated on lifetime PD) is required to cover credit risk exposure.
> Strategic Growth: The system is designed to accelerate loan book growth and provides a simplified pathway for the lender to transition to in-house securitization when the portfolio reaches sufficient scale.
