How Data Can Drive Better Financial Results
In this special role, Greg Wright, Executive Vice President and Chief Product Officer for the Experian Consumer Information Services (CIS) business in North America, discusses how the financial services industry must continue to use the most accurate data solutions. and the most complete to enrich the credit. decisions, while informing consumers of the options available to them. Greg has been with Experian since 2016. He has over 18 years of experience managing products to launch breakthrough solutions. Wright has a proven track record of delivering successful solutions to the market through acquisitions, innovations and tactical partnerships. He is a strategic business leader who focuses and aligns teams on the most important growth opportunities. Greg holds a Juris Doctorate from Stanford Law School and a Bachelor of Science in Environmental Economics from Stanford University.
As Americans move past one year of living with the pandemic, many are reflecting on how society has been affected. Similar to the economic crisis of 2008, COVID-19 posed insurmountable challenges that forced many unemployed consumers and entire businesses to close their doors for good. However, unlike the 2008 crisis, consumer credit has shown resilience.
According to Consumer Financial Protection Bureau August 2020 Research (CFPB) negative credit results were much less severe than expected during a period of high unemployment. Defaults on mortgages, auto loans, student loans and credit cards declined between March 2020 and June 2020, and consumers did not appear to be racking up debt on their credit cards to stay afloat. 
While many would argue this was due to government relief programs, there is another key difference between the Great Recession and where we are today. Today, the financial services industry has much greater access to immediate, complete and accurate data – a key factor in helping businesses and consumers on the road to recovery.
As we begin to turn a corner on the pandemic, we must continue to think about the long-term economic impacts. To ensure the well-being of our economy, we must continue to leverage data-driven solutions to protect consumers’ access to credit. It starts by helping lenders identify people who can still meet their financial obligations. These consumers play a critical role in getting our economy back on its feet because they are able to spend money which, in turn, can fuel economic stability and growth.
On the other hand, there are millions of consumers who have struggled and continue to struggle to meet their financial obligations. As of mid-February 2021, the Department of Labor estimates that 10.1 million Americans are still unemployed.  The CARES Act and stimulus payments have been effective in increasing the number of consumers able to maintain their financial health for a period of time, but some still need extra help getting back on their feet.
With accurate data, the financial services industry has the power to create a picture of credit worthiness that was not possible a decade ago, while also improving access to financial services for consumers who were perhaps traditionally excluded from the credit ecosystem.
A layered approach to data can help deliver a tangible good to consumers who need it most. Although traditional credit data remains the primary method of assessing consumer creditworthiness, lenders have new opportunities to overlay traditional credit data with extensive data compliant with the Fair Credit Reporting Act (FCRA). This type of data includes:
- Invoices for monthly cell phone, cable, internet and streaming services payments
- Repayment of leases or small dollar loans
- How a person manages their accounts over a 24 month period, called “trend data”
The financial services industry continues to innovate to meet unmet needs. For example, there are new lender rating models that combine traditional, alternative and trending data sets to create a more holistic picture of consumer financial behavior. These scoring models have the potential to help more than 40 million invisible credit consumers access credit, while giving other borrowers a second chance to participate in the credit ecosystem.
There are also new data-driven solutions that allow consumers to instantly improve their bottom line. These solutions have enabled millions of thin file consumers to receive credit for paying their regular cell phone, cable and internet bills – payments that had never been accounted for in a report before. traditional credit – to improve their credit profile.
Together, as the financial services industry, we must continue to use the most accurate and comprehensive data solutions to enrich credit decisions, while educating consumers about the options available to them. Educating consumers about the information on their credit report and how to improve their credit history is an important step in rocking the economy as a whole and helping those who need it most.
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