In the broadest sense, alternative data refers to all non-financial information that can be used to estimate the lending risk of an individual. Information includes:
- Utility bills (such as electricity, gas, and heating oil)
- Telecommunications bills (such as landlines and mobile telephones)
- Rental payments
- Electronic payments (remittances, withdrawals, transfers, etc.)
Alternative credit data looks beyond conventional credit bureau data, which typically focuses on credit activity such as credit card, mortgage, and auto lending. These non-traditional credit behaviors, when paired with the traditional credit behaviors currently used in conventional credit scores, deliver a more complete view into a consumer’s credit worthiness.