Influential government-related mortgage investor Freddie Mac is approving Truv for both consumer-permissioned income and payroll verifications, putting it in competition with other employment data vendors like Equifax.

Truv's addition to the list of vendors Freddie has enough confidence in the data accuracy of to greenlight may be significant because the vendor's CEO, Kirill Klokov, said it's using a method others don't that will put downward pressure on pricing for employment verifications.

"We don't need to pay the payroll providers or employers anything. We can log into your payroll account, like ADP, for example, on your behalf, and that's why, by eliminating the middleman as a company, we save a lot of money throughout this process," Klokov said.

While the description of the strategy is straightforward, he said it required a lot of legwork to set up in line with what he sees as an evolution in digital verifications of payroll data going on now similar to what was seen with bank data in the past.

"What happened in banking with companies like Plaid and Finicity, that's what's happening with payroll right now," Klokov said.

While there are parallels with bank data, digital verifications of payroll information do have a unique challenge related to the composition of companies that serve as repositories for it.

"When you talk about banks, there are like five large banks that are controlling roughly 60% of assets. The challenge with payroll is there's ADP and ADP is big. Everybody else is very small," said Klokov.

In addition, the small providers are numerous.

"The challenge is we have to build 13,000 distinct integrations to cover enough employers and enough employees on those payroll providers," Klokov said.

Truv's reach extends to 92% of the workforce, it has integrations with some industry point of sale systems and works around 70 mortgage lenders, according to a company press release.

It will join five other companies approved to offer employment data verifications in conjunction with loan sales using Freddie Mac's Asset and Income Modeler platform: Blend, Equifax, Experian, Finicity and Informative Research, some of which are resellers.

In joining this group, Truv will test how its strategy and pricing stacks up against a competitor like Equifax's The Work Number, which was a pioneer in the space and has established contracts with large data sources and lenders.

Lenders struggling with profitability have shown some fatigue with recent increases in vendor charges like credit scores. Equifax acknowledged in its recent earning call that Work Number prices have been rising, but noted that some of it is for premium data.

"If you have more valuable data, you're able to charge more for it," Equifax CEO Mark Begor said in response to an analyst's question about Work Number's pricing during the company's third-quarter earnings call.

"We really execute two ways, pure price, meaning we do annual price increases, and we also get price through delivering new products with either more historical data or data combinations that deliver more value to our customers," Begor said.