Improving Credit Scores By Expanding User History 

Credit scores are arguably the most important metric that is used to measure someone’s financial stability in the United States. It is a direct reflection of a consumer’s ability to pay back loans in time, which demonstrates their trustworthiness when borrowing money. Having a low credit score can signify that a person will likely not pay back what they have borrowed, so companies will often offer significantly higher interest rates. This can end up costing an individual a lot in the long run; for example, over the course of a 30-year mortgage, a homeowner with a low credit score can end up paying $30k in additional interest compared to those with a prime score. 

Low credit scores don’t always come from failing to pay back loans. Having a small credit history, regardless of the reason, can drop a score by a significant number of points. 76 million Americans struggle with having little or no credit at all, which can keep them from accessing important loans. This disproportionately affects young people, recent immigrants, widows and divorcees, and predominantly cash or debit users. Leveraging alternative data can help bolster an individual’s credit history outside of traditional reporting and boost their scores into a prime rating.