They're reinventing community banking. In small towns the bankers knew you, knew your family and made judgments on character and less on credit score.

Kids were borrowing for 4H animals, buying their first car, planting a field using dad's tools and paying those loans back promptly. All of that has gone away, but is being rediscovered.

Community banking is important but cannot replace how modern banks work. Loan volumes are usually small as you cannot give a loan of several million dollars just because you think the other person is trustworthy. Also, this system works for people who stay in their hometown but can make it hard for newcomers to get credit. If you're new in town and your neighbours don't like you it doesn't mean you should be denied credit.

FICO scores are far from perfect but it's the best system banks could come up with so far. All large banks are in the business to make money. If someone comes with better risk measures that can increase lending and keep risk low, they'd happily adapt it.

The big problem with replacing FICO is that new methods based on machine learning often exhibit some form of racial bias which can cause huge fines by the CFPB. So banks try to avoid any new techniques until they can be certain that the system doesn't bias towards certain groups.

I would be extremely annoyed if my mortgage or credit card company actually tried to foist some advise on me.

I understand the sentiment. But if you had a low score due to poor financial management, you'd be better off getting some education with your loan than not getting a loan at all.

That said, these are small business loans, which is an area where advise would presumably be a lot more welcome than on a mortgage.

this is silicon valley. Every investor you meet tries to give you advice on how to run your company and live your life, even if 99% aren't going to invest in you.

I don't think that's limited to SV.

Investors/advisors with free advice are abundant.

Just remember it's worth what you paid for it 99% of the time.