I had the opportunity to participate in the #Lend360 event in Dallas, Texas (Sep 25 – 27 2019) as a speaker. It was a great event that focused on online lending industry, especially Fintechs, with over 800 lending professionals and sponsors in attendance.()
I was a member of the panel on “Serving Everyday America: Products and Services for the Non-Prime Market”. I spoke on how #Alternativecreditdata enables lenders to understand and reach their customers in three big ways.
Alternative Credit Data is now being used by prime as well as non-prime lenders to book new customers. By using a host of new generation Fair Credit Reporting Act (FCRA) approved credit risk solutions, lenders can now understand their customers better and hence tailor products and services accordingly. Alternative data is also a key component that can help expand #Financialinclusion initiatives to deliver financial services to the hitherto unserved sections of society
In my discussions I highlighted the following three –
1. The US has an estimated 53 million adults who are outside the purview of traditional credit bureaus. It is now well known that alternative data can identify and score approximately 90% of this population
2. Secondly, alternative data enables lenders to differentiate between consumers with similar traditional credit bureau profiles. This is because it can provide granular segmentation and a 360 degee view of applicants that is possible only when we use FCRA compliant not-tradeline data.
3. Thirdly, from an acquisition perspective, whatever segments the lender targets using alternative data, for the same risk – or charge offs – alternative data is capable of booking more accounts.