Alternative Data and its Use in Credit Scoring Thin- and No-File Consumers

18 Pages Posted: 17 Jul 2008 Last revised: 14 Sep 2008

See all articles by Julia S. Cheney

Julia S. Cheney

Federal Reserve Bank of Philadelphia

Date Written: February 1, 2008

Abstract

On November 27, 2007, the Payment Cards Center of the Federal Reserve Bank of Philadelphia invited Jennifer Tescher, director, and Arjan Sch¿tte, associate director, of the Center for Financial Services Innovation, to present a workshop. The Center asked Tescher and Sch¿tte to share CFSI's research on the developing role played by alternative payment data in evaluating risk for consumers with thin- and no-credit histories. After a discussion of thin- and no-file consumers and the challenges they face accessing credit, the speakers addressed aspects of supply and demand that are influencing the development of the market for alternative data. Several additional factors acting on this market were also examined: the costs and complexity of changes to IT infrastructure, legal and regulatory hurdles, and the broader economic impacts of extending the market for consumer credit.

Suggested Citation

Cheney, Julia S., Alternative Data and its Use in Credit Scoring Thin- and No-File Consumers (February 1, 2008). FRB of Philadelphia - Payment Cards Center Discussion Paper No. 08-01, Available at SSRN: https://ssrn.com/abstract=1160283 or http://dx.doi.org/10.2139/ssrn.1160283

Julia S. Cheney (Contact Author)

Federal Reserve Bank of Philadelphia ( email )

Ten Independence Mall
Philadelphia, PA 19106-1574
United States

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