Credit is a modern tool which is vital to taking on loans and making purchases that aren’t cash-accessible. It’s vital for essential items such as a car or home, but it’s also something which countless Americans struggle with. Almost a third of all adults in the U.S have little to no credit built or are entirely credit invisible.
In practice this means that any Americans looking to buy essential products will have to take on suboptimal loans and deals. Low credit can mean extremely expensive loans or being denied from taking on a loan entirely. It’s essential then that every American who can be scored and made aware of their credit score- should be.
New AI powered and alternative data credit scoring is aimed at reaching this end. The combination of this new data alongside AI data could make upwards of 6.5 million Americans scorable. Many modern Americans who choose to have no credit card or other obvious credit source still pay their bills. Utility bills in particular are a great avenue for this AI powered scoring to take advantage of.
This is without mentioning the credit boost that those with thin files could experience with this new scoring. The changes won’t be massive, they’ll be much closer to 10 or 25 points in practice. However, that can make or break a long term loan with ease. These are the advantages of AI powered telco and utility data scoring. They’re not overwhelming, but they’ll help the Americans who most need it.