Legitimatizing Alternative Data/Analytics: A Consumer Credit Market Overview
Report Summary
Legitimatizing Alternative Data/Analytics: A Consumer Credit Market Overview
Lenders are and plan to continue committing IT budget funds to data and analytics.
Boston, January 18, 2017 – U.S. financial institutions have been searching for new consumer borrowers since 2010 and look to become more inclusive in credit decisions. Now, IT budgets are on the rise, including spending increases for data and analytics. And not just any data: Alternative data that enables the development of new scores and attributes is now part of the mix. Can retail credit data/analytics investments for 2017 and 2018 not only increase financial inclusion but result in cost reductions, streamlined processes, and mitigated fraud risk?
Based on analysis from ongoing, in-depth Aite Group discussions with and interviews of senior management at U.S. banks, credit unions, and finance companies, this report details forward progress in legitimatizing the use of alternative data and analytics in retail credit and operational risk management. It gives FIs a look at a new “must have” in the search for unscorable borrowers with acceptable risk profiles and offers vendors and FIs a glimpse of the alternative data opportunity—the discoverability, profitability, and satisfaction of new customers.
This 34-page Impact Report contains 10 figures and one table. Clients of Aite Group’s Retail Banking & Payments service can download this report, the corresponding charts, and the Executive Impact Deck.
This report mentions Early Warning, Envestnet Yodlee, Equifax, Experian, FICO, ID Analytics, LexisNexis Risk Solutions, Narrative Science, and TransUnion.