TransUnion today released findings from a new benchmark survey it commissioned with Versta Research about the use of alternative data among lenders. Alternative data, which includes non-traditional data like checking and debit account histories, payday lending, address stability, property and tax records, etc., can help assess lending risk among consumers who have little or no traditional credit history.

“From a research perspective, the challenge of this work was the complexity of the topic combined with the audience we needed to reach,” said Joe Hopper, president of Versta Research. “The questions we asked had to be simple and direct, as did the story we developed from the findings. But there is nothing simple about how financial institutions innovate around building risk models.”

The survey of 317 lenders was conducted in the fall of 2015, and included loan officers at banks, credit unions, consumer finance companies, credit card and debit card issuers, mortgage providers, and other users of consumer credit data. Topics explored included:

• The challenge of extending services to unbanked and no-credit consumers
• Current usage of alternative data, overall and by specific lending segments
• The benefits of using alternative data to augment traditional scoring data
• Competitive pressures in today’s credit marketplace
• Future plans among lenders for adopting and using alternative data models
• Barriers to full adoption of alternative data among lenders

The full report is available for download from TransUnion at http://e.transunion.com/altdata-research. An infographic summary of findings is also available at http://blog.transunion.com/infographic-the-competitive-impact-of-alternative-data/.