CBA offers Info to CFPB on Alternative Data, Modeling Techniques in the Credit Process
On Friday, May 19, 2017, CBA responded to the CFPB’s Request for Information on the use of alternative data and modeling techniques in the credit process. The agency held a field hearing in February of 2017 regarding how financial institutions and credit reporting agencies are using sources of alternative data, and alternative modeling techniques to increase access to credit for the millions of Americans the Bureau designates as “credit invisible,” or those with too thin a credit file to produce a credit report. CBA’s response focused on the current types of alternative data members are currently using, as well as the regulatory risks associated with various types of alternative data preventing members from further innovating in this space.