Leo Loomie, SVP, Client Development at Digital Risk, an Mphasis company was quoted in BAI – Banking Strategies in the article titled “Changing the score: How alternative lenders rethink FICO ratings” talking about how lenders can incorporate factors beyond FICO scores to assess credit right.
“Given a FICO score’s limitations, building the most predictive model can include alternative data sources such as social media,” says Leo Loomie. For example, a LinkedIn profile can show current and past employment and where you earned your college degree.
“There’s more impetus for innovation internationally because there are a lot more underbanked, credit-invisible people,” says Loomie. Of the estimated three billion credit-invisible people globally, he contends many can pay a loan but lack a traditional data file.
He adds that psychometrics and personality assessments online have become a tool for alternative credit assessment, though generally outside the U.S. FICO is partnering internationally to create online assessments that ask, among other questions, whether someone feels they have the resources to repay.
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