Technological startup Nova Credit was finally gaining traction in the financial world when COVID-19 hit. In 2020, Misha Esipov, the company's cofounder and CEO, found himself in a tough situation: Nova Credit designed a service that allowed immigrants to bring their credit history from other countries to the United States. Credit Passport was Nova's first and main product, but when immigration dropped due to the pandemic, Nova's main market dried up. "We had to shift gears fast. " Nova's core product allowed financial institutions to approve immigrants who wouldn't have passed their credit checks. Their partnership with American Express and a $50 million funding boost in February 2020 at a $300 million valuation had Nova looking hopeful for the future. However, the pandemic had other plans. Banks reduced their use of Credit Passport by three-quarters, threatening Nova's survival. Nova Credit had to find a new way to stay alive.

"One summer talk changed everything. "  An executive from SoFi (a personal-finance company) got Nova thinking differently. With the pandemic causing job loss like crazy, the bad credit crisis was more severe than ever. Banks needed to check updated credit info to keep lending going. Nova used its existing tech to verify income for SoFi in just four months. Nova jumped into cash-flow (CF) underwriting. This measures a person's financial health based on recent bank activity rather than past loans. It's a powerful tool. Credit bureaus like FICO focus on past performance, ignoring current reality.

Nova pushed for cash-flow analysis as their second major service. Nova had to be flexible to stay relevant. Being a fresh and modern service, they welcomed the change in the market. Cash flow analysis helps lenders know if someone can pay their debts now, not just in the past. Nova's predictions are based on data like balance and inflow patterns. If a person frequently runs close to zero, it's not a disaster: it shows they can manage their money. Any warning signs, like repeated overdrafts, hurt their credit score.

Nava began its journey with its original product--Credit Passport was the product the pioneered the ability for immigrants to bring their credit history from abroad--to help them get better credit access in the states. They had no idea if it would pull through. Many companies might give up, not Nova: they focused on credit underwriting. "It was a scary risk. "

"Today, Nova’s newer service has become the company’s leading product line. " It's being used by some of the largest banks in North America and telecom companies. Where Nova started its journey with 5 major customers in 2016, now it has five of the biggest banks in North America.

Nova's success with Credit Passport and cash flow analysis is impressive. However, competition is fierce, especially with their major services hitting the mainstream in 2024 and 2025. "Nova must strive for efficiency to avoid being outcompeted. "

/Nova Credit has since became a major name in the credit industry, with a history of innovation that will influence your future.

The Unexpected Pivot: How a Fintech Helped Immigrants During COVID

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