Freelancer Overdrafts

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This guide explains how to integrate Solaris' Overdraft product for freelancers into your solution.

Introduction

Product specifications

Freelancer overdrafts are currently only available for customers with a current bank account with Solaris. For more information about overdrafts and how they work, check the Overview page.

Credit scoring

Solaris uses an automated credit scoring system (Freelancer Overdraft Scorer) to make informed credit decisions on freelancer overdraft applications. The scorer collects and analyzes different information, such as the customer's financial information, credit data, transaction history, and outstanding loans, to assess their creditworthiness and determine their risk level and credit eligibility.

Based on different checks done throughout the application lifecycle, the scorer estimates the probability of default (PD), determining the customer's rating class, whether an overdraft is offered and the limit amount granted.

Credit risk analysis

The scorer uses the following information in the credit risk analysis:

1. Account snapshot

Solaris collects information about the customer's account data and history from their current account with Solaris. Such information includes account balance, transaction history, bookings, and recurrent repayment amounts.

2. Information from credit agencies

Credit information and score about the customer, collected from external Credit Bureaus (e.g., SCHUFA).

System prerequisites

Before integrating Solaris' Consumer overdrafts for your retail customers, the customers must have been onboarded and have a checking bank account with Solaris. For step-by-step instructions on person onboarding for Digital Banking and Cards, check the Person onboarding guide.

Integration overview

The following diagram gives an overview of the integration flow for Freelancer Overdrafts:

Integrate Solaris' Freelancer Overdrafts by completing the following steps:

You can find detailed descriptions of these steps and their related endpoints in the following sections.

Webhooks

Solaris recommends subscribing to the following webhook events to better automate your processes. For detailed instructions on implementing Solaris webhooks, check the webhooks documentation.

• OVERDRAFT_APPLICATION
• OVERDRAFT
• FREELANCER_OVERDRAFT_INTEREST_RATE_CHANGE

Step 1: Update the customer person resource

As a first step, you must collect the contact_address from the customer and update their person resource. This is important if the customer's address has changed in the past two years to avoid rejection due to address mismatch.

Request example

PATCH /v1/persons/{id}
{
    "contact_address": {
        "line_1": "Musterstrasse 10",
        "line_2": null,
        "postal_code": "78550",
        "city": "Musterstadt",
        "country": "DE",
        "state": "BE"
    }
}

View full API reference

Step 2: Create freelancer credit record

In this step, you must create a freelancer credit record and link it to the person resource of the relevant customer.

What is a credit record?

The credit record contains the customer's credit data and history. Creating a credit record is mandatory for Lending integrations, as it is used for credit scoring to determine the customer's creditworthiness and eligibility.

Create a credit record

To create a credit record, you must choose a source in the request body:

1. source: solarisBank (Automated) Solaris retrieves the customer's record directly from SCHUFA. This is the standard recommended process.

2. source: partner (Manual Upload) You collect the credit record manually from SCHUFA or third-party providers and upload it to Solaris.

   • Requirement: You must Base64-encode the file and pass the content in the file field.

Endpoints:

Depending on your customer type, use one of the following endpoints:

Retail Customers

POST /v1/persons/{person_id}/credit_records

• API Reference: Create retail credit record

Freelancers

POST /v1/freelancers/persons/{person_id}/credit_records

• API Reference: Create freelancer credit record

GET Retrieve a credit record

Call this endpoint to check the status and validity of an existing credit record.

Request URL

GET /v1/persons/{person_id}/credit_records/{credit_record_id}

• API Reference: Retrieve credit record

Step 3: Create freelancer overdraft application

In this step, you must pass the mandatory information you collected from the customer in your sign-up flow to Solaris by creating a freelancer overdraft application.

The overdraft application includes all the required information about the customer and links to other mandatory resources, such as credit_record or account_snapshot, which the credit scorer uses to initiate a series of credit checks.

POST Create freelancer overdraft application

This endpoint creates a freelancer overdraft application for the given customer with the person_id specified in the request URL.

Mandatory properties:

Add the following mandatory properties in the request body:

• credit_record_id: The unique ID of the freelancer credit record created in the previous step.

Request URL

POST /v1/persons/{person_id}/overdraft_applications

Response example

The API call returns an object with a unique id for the freelancer overdraft application, including the application status, set initially to initial_scoring_pending (in case of two-step scoring) or account_snapshot_pending (in case of one-step scoring), and the remaining attributes, which will be populated during the application lifecycle.

View full API reference

Scoring

This API call automatically triggers Solaris' automated credit scoring system, which scores the application and provides its decision on the overdraft application.

Approved application

If Solaris scorer approves the application, the application status changes to account_snapshot_pending. In this case, notify the customer on your frontend and continue with the remaining steps in this guide.

Rejected application

In case of rejection, the application status changes to rejected. Notify the customer on your frontend and abort the process.

GET Retrieve freelancer overdraft application

This endpoint returns the current status and details of an existing freelancer overdraft application. For a list of possible values of the application status and their descriptions, check the Appendix.

Additionally, subscribe to the webhook event OVERDRAFT_APPLICATION to receive status updates on the application.

Request URL

GET /v1/persons/{person_id}/overdraft_applications/{overdraft_application_id}

View full API reference

Application status flow

The following diagram describes the status flow of a freelancer overdraft application:

Step 4: Create account snapshot

In this step, you must create an account snapshot for the customer and link it to their overdraft application.

What is an account snapshot?

The account snapshot contains a breakdown of the customer's account information, such as balance, transactions, bookings, and recurrent repayment amounts over a specific period. It is mandatory for Lending integrations, as it is used for credit scoring to verify the customer's financial data.

Create an account snapshot

Call the endpoint below to create a snapshot. You must specify the source field to determine the integration method.

Request URL

POST /v1/persons/{person_id}/account_snapshots

• API Reference: Create snapshot

Method 1: FinTecSystems (FTS)

Use this method to integrate the FTS wizard.

1. Integrate the FTS wizard in your solution (see FTS Documentation).
2. Call the endpoint with source: FIN_TECH_SYSTEMS. Optionally, include the iban.
3. Use the returned wizard_session_key to initialize the FTS wizard.
4. The customer enters their credentials in the wizard.

Request:

{
  "source": "FIN_TECH_SYSTEMS"
}

Response:

{
  "wizard_session_key": "Hm7jUSC7XU2nQjPqJO8dl39eDkdjtOdCtywcmv3x",
  "location": null,
  "id": "8df2a8ba713c43dc9cb481b9cceed487snap",
  "account_id": null
}

Method 2: Finreach

Use this method to integrate the FinX widget.

1. Integrate the FinX widget (see FinX Documentation).
2. Call the endpoint with source: FINREACH.
3. Redirect the customer to the URL provided in the location field.

Request:

{
  "source": "FINREACH"
}

Response:

{
  "wizard_session_key": null,
  "location": "https://ui.solaris-i.prod.finleap.cloud?token=xxxxxx",
  "id": "8df2a8ba713c43dc9cb481b9cceed487snap",
  "account_id": null
}

Method 3: Partner (Manual Upload)

Use this method if you have your own connection to a third-party provider and want to upload the data directly.

• Set source to PARTNER.
• Include the full data structure in snapshot_data.

Request:

{
  "source": "PARTNER",
  "snapshot_data": {
    "account": {
      "bank_name": "",
      "bic": "",
      "country_id": "",
      "description": "",
      "holder": "John Smith",
      "iban": "DE92370601930002130041",
      "joint_account": false
    },
    "balance": {
      "balance": 3720.2,
      "currency": "EUR",
      "date": "2022-02-03",
      "limit": 0
    },
    "date": "2022-02-03",
    "days": 90,
    "turnovers": [
      { … }
    ]
  }
}

Method 4: Solaris (Internal)

Use this method if the customer already has a Solaris account.

• Set source to SOLARISBANK.
• Include the account_id of the Solaris account.

Request:

{
  "source": "SOLARISBANK",
  "account_id": "adc123a45d6d7cf8fbfeed537ba919d5cacc"
}

Response:

{
  "wizard_session_key": null,
  "location": null,
  "id": "0a3f28733f9a4842842aae2804f80eb4snap",
  "account_id": "adc123a45d6d7cf8fbfeed537ba919d5cacc"
}

GET Retrieve account snapshot

Call this endpoint to check the status and validity of an existing snapshot.

Request URL

GET /v1/persons/{person_id}/account_snapshots/{account_snapshot_id}

• API Reference: Retrieve snapshot

PUT Link account snapshot to overdraft application

This endpoint links an account snapshot to an overdraft application. You must include the account_snapshot_id in the payload of this endpoint.

Request URL:

PUT /v1/persons/{person_id}/overdraft_applications/{overdraft_application_id}/account_snapshot

View full API reference

After linking the account snapshot, the overdraft application status changes to account_snapshot_verification_pending. This is the final step in the data verification process and credit risk analysis. Afterward, Solaris gives the final verdict on the overdraft application, changing the application status to either offered or rejected.

Step 5: Create the overdraft

After Solaris approves the overdraft application, the application status changes to offered. Afterward, you have to do the following steps:

1. Inform the customer of the approval on your frontend, and show the offered overdraft limit and applicable interest rates.
2. Collect and record the customer's consent to Solaris' overdrafts terms and conditions and the overdraft loan agreement.
3. Create the overdraft on the customer's account by calling the following endpoint.

PUT Create the overdraft

This endpoint creates the overdraft on the customer's account. You have to add the customer's account_id in the request body of this endpoint.

Request URL

PUT /v1/persons/{person_id}/overdraft_applications/{overdraft_application_id}/overdraft

Example response

The API call returns the overdraft information, including the overdraft id, limit, and overdraft_rate. Afterward, the overdraft application status changes to overdraft_created.

View full API reference

GET Retrieve overdraft

This endpoint returns all the details of an existing consumer overdraft, assigned to the person with the person_id in the request URL. Additionally, subscribe to the webhook event OVERDRAFT to receive status updates about the overdraft. For a list of possible values and their descriptions, check the Appendix.

Request URL

GET /v1/persons/{person_id}/overdrafts/{overdraft_id}

View full API reference

As the interest accrual rate could change from time to time, we encourage you to subscribe to the webhook FREELANCER_OVERDRAFT_INTEREST_RATE_CHANGE. This allows you to get the latest interest information and update the information in your frontend without calling the GET Retrieve overdraft endpoint.

Step 6: Servicing overdrafts

This section includes important information about handling and monitoring active overdrafts.

Overdrafts limits and interest

Overdraft limits cannot be exceeded for any SEPA transfers, direct debits, payments, or withdrawals, except for charged interest fees by Solaris. Any payment exceeding the limit will be rejected.

Overdrafts monitoring (Optional)

For specific overdraft-related events, you can monitor the account, implement specific event triggers, and provide pre-defined messages to the user.

For example, you can implement event triggers and send out reminders to customers in the following events:

• The customer has used 90% of the overdraft limit or only 100€ remaining in the limit.
• Three days before the interest payment is due to customers with a used overdraft at the end of each quarter.

Overdrafts booking types

Using the overdraft limit reflects on the customer's account statement for interest charges. The following booking types are distinct to overdraft interest charges:

• InterestOverdraft: The interest accrued in relation to the used portion of the overdraft limit.
• InterestOverdraftExceeded: The interest accrued in relation to exceeding the overdraft limit (Note that the limit itself cannot be exceeded for regular transactions except for interest charges).

Account closure for accounts with an overdraft

In case of Account Closure Requests (ACR) for accounts with an attached overdraft, you must first terminate the overdraft before initiating the ACR process.

Overdrafts in statements of account & bank statements

Each statement of account and bank statement generated for customers with overdrafts will contain the following overdraft information for the statement period:

• overdraft_facility: Overdraft facility that has been granted to the customer.
• overdraft_rate: The increased interest rate applied when going below the granted overdraft facility.
• interest_accrual_rate: The daily rate at which interest is accrued on the used amount of an overdraft.
• interest_accrued: The interest accrued, in Euro cents.

See the Account management guide for more information.

Overdrafts termination

To terminate a freelancer overdraft, you can trigger the termination request by calling the following endpoint:

POST Terminate a freelancer overdraft

This endpoint initiates a termination request for an existing freelancer overdraft.

POST /v1/persons/{person_id}/overdrafts/{overdraft_id}/terminate

View full API reference

Next steps

Congratulations! You have successfully integrated Solaris' Freelancer Overdraft solution.

Check the following appendices section for additional information on enums and testing data.

For an overview of Solaris' lending products, check the lending products overview page.

Useful resources

Check the following links for additional related guides and API reference documentation.

• Freelancer Overdrafts API Reference documentation
• Overdrafts overview

Appendix I: Enums

Freelancer overdraft application status

These are the possible values for the field status in the freelancer overdraft application resource.

Freelancer overdraft status

These are the possible values for the field status, which indicates the status of an overdraft that is already offered.