UK Credit Week Participants Define and Discuss the Importance of Alternative Dat ...

THE USE OF ALTERNATIVE CREDIT DATA was one of the many topics that was top of mind at the 2024 Credit Week event in the United Kingdom.

At the week-long event, Karl-Magnus Wadsack, Strategic Growth Director, Equifax, participated in a panel discussion around the use of alternative credit data and its benefits in credit decisioning.

The panel -made up of UK industry experts- agreed that alternative data consists of data sources that fill gaps in a traditional credit score or scoring methodology. For example, in the UK, balance and transactional data from open banking is an alternative data source that can be used by lenders in the credit decisioning process.

Alternative data can make significant differences to the decisions and outcomes of consumers. For consumers with thin or no credit files, the ability of lenders to utilize alternative data can lead to greater access to credit and potential for better credit terms.

Consumers who may be new to the credit ecosystem due to things like immigration or a history of making purchases with cash, may find themselves unscorable through traditional views of credit. Incorporating alternative data into the process (like several months of a consumer's financial transactions) may give lenders a more holistic view of an individual, which can lead to more offers of affordable credit.

The entire panel discussion along with many of the presentations from Credit Week can be viewed on YouTube.

Additionally, this 2024 U.S. Alternative Data infographic highlights the power of our alternative data and how it can help expand access to credit in the U.S.