Building credit systems for a mobile Europe
How banks can enable cross-border credit data securely and GDPR-compliantly?
This post originally appeared in the lending and proptech issue of FinanceX Magazine in August 2025.
Every day, 4,100 Europeans cross borders within the EU to start new jobs, pursue education, or reunite with family.
According to the latest Eurostat migration data, 1.5 million people previously residing in one EU country migrated to another EU country in 2023. These aren't desperate migrants or unusual cases – they represent Europe's most mobile professionals, with a median age of just 30.5 years compared to 44.7 for the general population.
Yet when these Europeans apply for credit in their new countries, most face blank-slate assessments that ignore years of responsible financial behavior. Their credit histories stop at national borders, creating a systematic exclusion of prime banking customers.
The scale of European mobility
The numbers reveal a substantial and consistent market. As Eurostat reports, total migration flows to major European destinations are significant – Germany received 1.27 million new residents in 2023, Spain 1.25 million, indicating the scale of cross-border financial services demand. More telling is the age concentration: working-age adults in prime career-building years, suggesting economic opportunity as the primary migration driver.
Geographic concentration amplifies the opportunity. Malta recorded 76 new residents per 1,000 inhabitants, Cyprus 43 per 1,000, and Luxembourg 40 per 1,000. In Luxembourg specifically, 85.7% come from other EU countries, meaning established European citizens who should be straightforward banking customers.
However, banks often reject these customers not because they lack creditworthiness, but because legacy systems cannot access their financial histories across borders.
These patterns persist year after year. Eurostat's analysis shows stable migration flows that create predictable customer streams for institutions positioned to serve them. Countries like Germany and Spain consistently rank among the top destinations, creating geographic corridors where cross-border banking expertise delivers competitive advantages.
The credit assessment gap
Current credit evaluation could treat a German software engineer relocating to Antwerp as higher risk than a local recent graduate, despite fifteen years of payment history versus six months of employment.
This reflects system failure, not data scarcity. Credit information exists in comprehensive detail across European national credit bureaus. Payment histories, loan performance data, and creditworthiness evaluation capabilities are available throughout the EU. While some data exchange agreements can be found among bureaus, their use remains limited. The problem lies in fragmented access – each country's financial institutions can typically see only their domestic data, making cross-border risk assessment challenging.
Some banks and credit providers compensate with crude workarounds: higher interest rates for cross-border applicants, extended approval processes, or outright rejections. These approaches misprice risk systematically, penalizing mobile professionals while missing profitable lending opportunities. Meanwhile, their competitors able to access cross-border credit data capture premium customers that others reject.
The infrastructure solution
Technology to resolve this fragmentation exists today. Secure APIs enable encrypted data exchange, and GDPR-compliant consent protocols allow cross-border data sharing. Real-time verification systems can confirm identities across national boundaries within minutes.
There's also no need for the technical complexity that building entirely new centralized infrastructure would create. National credit bureaus have operated independently for decades, developing their own scoring methodologies and data formats. Platforms like Mifundo enable bureaus to maintain their existing data and systems while providing authorized cross-border access when customers consent.
GDPR includes data portability provisions that allow individuals to obtain and transfer personal data under specific circumstances, particularly when processing is based on consent or contract performance. This fundamental principle provides a legal foundation for cross-border credit data sharing when proper consent mechanisms are in place.
Early implementations by institutions willing to invest in cross-border capabilities demonstrate viability: they can complete risk assessments without requiring customers to rebuild their financial histories from zero, reducing both processing time and rejection rates for qualified applicants.
Competitive implications
First-mover advantages in cross-border credit assessment compound quickly. Banks that attract mobile professionals while competing banks turn them away gain access to underserved premium segments that demand larger loan amounts and sophisticated financial products.
Better data enables more accurate risk pricing. Banks with comprehensive credit histories can offer competitive rates to qualified borrowers, instead of rejecting applications or pricing for worst-case scenarios.
European financial regulators increasingly recognize that domestic-only risk assessment may not adequately serve the EU's mobile population, creating space for more sophisticated cross-border evaluation methods.
Building connected systems
The European Union enables free movement of people across member states, but financial systems have historically operated within national boundaries.
The technical capabilities for secure cross-border data sharing exist today. The challenge requires some technological sophistication and institutional coordination. Secure cross-border data sharing demands standardized protocols, regulatory compliance frameworks, and trust networks that individual banks or bureaus cannot build effectively alone.
Banks and credit providers that build these connections first will define the standards others follow. The alternative is continuing to reject Europe's most mobile and qualified customers instead of capturing the opportunities that cross-border data connectivity creates.
