Publications
Data diversification in Credit Underwriting
Research Brief
Report Summary
The reliability of traditional data in rapidly changing economic conditions and the need for greater financial inclusion are increasing incentives to use new information sources and predictive models to improve credit scoring and underwriting.
This Research Brief catalogues recent initiatives to provide more data sources and third-party scoring models, which could be particularly important to help smaller players adapt their processes and systems. It also considers how recent events have made some of the longer-term market and policy issues identified in our previous report, The Use of Cash-Flow Data in Credit Underwriting: Market Context & Policy Analysis, more challenging to solve.
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The Use of Cash-Flow Data in Underwriting Credit: Market Context & Policy Analysis
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The Use of Cash-Flow Data in Underwriting Credit
Records from consumers’ deposit and card accounts and from small businesses’ accounting software can provide a relatively detailed and comprehensive picture of how applicants manage their finances on an ongoing basis. FinRegLab conducted an empirical assessment of the data’s benefits and risks, as well as market and policy analyses of the challenges to its wider… Learn More
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FinRegLab is an independent, nonprofit organization that conducts research and experiments with new technologies and data to drive the financial sector toward a responsible and inclusive marketplace. The organization also facilitates discourse across the financial ecosystem to inform public policy and market practices. To receive periodic updates on the latest research, subscribe to FRL’s newsletter and visit www.finreglab.org. Follow FinRegLab on LinkedIn and Twitter (X).
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