“cash-flow data – such as records of transactions in and out of consumers’ deposit and card accounts – can improve risk prediction because it evidences how applicants manage their finances.”
FinRegLab in the News
How to Protect Your Credit Score During the Coronavirus Pandemic
www.consumerreports.org
“Many companies report to credit bureaus in batches, she says, and accounts that are 30 days delinquent typically get reported about a month after the bills were due. That means that many payments missed in the early phases of the COVID-19 crisis are likely to hit the credit agencies very soon.”
“A shift in people’s creditworthiness ranking has been happening all over the world. We need to make sure the change’s innovative impact is a financially inclusive and anti-discriminatory one.”
FinRegLab in the News
‘Out of the Shadows’: Use of Alternative Data in Lending Gains Ground
www.americanbanker.com
“Regulators are trying to send an important signal that they are aware that there are certain data that can be quite useful, especially in assessing credit risk for an underserved population.”
FinRegLab in the News
Use of Alternative Data in Underwriting Receives ‘OK’ from Federal Regulators
www.jdsupra.com
“U.S. federal banking regulators issued an interagency statement supporting the evaluation of alternative data when assessing consumers’ creditworthiness.
FinRegLab in the News
Social Credit: Much More Than Your Traditional Financial Credit Score Data
www.forbes.com
“A shift in people’s creditworthiness ranking has been happening all over the world. We need to make sure the change’s innovative impact is a financially inclusive and anti-discriminatory one.”
“Using Income and spending data can open up access to credit, a September FinRegLab study indicated. The study analyzed information from FinTechs like LendUp Global and Petal Card that extend loans based on alternative data.
“Consumers with spotty or no credit histories might find it easier to get loans after federal banking regulators endorsed alternatives to traditional methods of assessing creditworthiness.
“Does the financial sector stay distinct? Does financial data stay distinct? If so, how does that happen when all this line-blurring is going on? I’m not exactly sure how it will play out. But I strongly suggest that’s going to be the central question over the next five years…
“One hundred definitions” of fairness can make algorithms difficult “onions to unpeel.”