Lenders Are Having Trouble Figuring Out Who is Creditworthy Today

Lenders today have a credit blind spot; this is because of the provision in the government stimulus package that allows borrowers to defer their debt payments without penalty; these borrowers are not reported as late to the credit bureaus; consequently bank and non-bank lenders have tightened underwriting considerably and reduced loan volume; according to Equifax personal loan volume is down from 226,000 loans in the week ending March 22 to 79,000 loans for the week ending May 10; credit card originations and auto loans were also down considerably; lenders are looking to different data sets to try to measure risk such as cell phone data and cash flow data. The Wall Street Journal.

  • Peter Renton

    Peter Renton is the chairman and co-founder of Fintech Nexus, the world’s largest digital media company focused on fintech. Peter has been writing about fintech since 2010 and he is the author and creator of the Fintech One-on-One Podcast, the first and longest-running fintech interview series.