WASHINGTON — The Consumer Financial Protection Bureau (CFPB) has issued a request for information (RFI) that seeks information about the use of alternative data and modeling techniques in the credit process, JD Supra Business Advisors reported.
According to the CFPB, the RFI stems from the bureau’s desire “to encourage responsible innovations that could be implemented in a consumer-friendly way to help serve populations currently underserved by the mainstream credit system.”
A number of people who have never had a loan, credit card or otherwise received credit through firms like utility companies can be denied loans because they don’t have a typical “credit score.”
A CFPB report, “Data Point: Credit Invisibles,” concluded that the current credit reporting system is precluding certain populations from accessing credit and taking advantage of other economic opportunities, the publication explained.
The full story is available at jdsupra.com.