“Give Me Some Credit!”: Using Alternative Data to Expand Credit Access

Abstract: Fintechs, credit bureaus, and financial institutions are collecting alternative data to develop new scoring models that supplement traditional credit reports. Studies, providers, and pilot programs suggest that these alternative data can improve credit reporting and thereby expand access to fair credit. However, use of alternative data is still low due to both uncertainty about the benefits relative to the cost and consumer concerns about use and privacy.

Keywords: credit reports; credit scoring; alternative data;

JEL Classification: E51; G21; E5;

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Bibliographic Information

Provider: Federal Reserve Bank of Kansas City

Part of Series: Payments System Research Briefing

Publication Date: 2023-06-28

Pages: 6