Building a case for alternative credit data: Scoring persistently credit invisible consumers

by Ken Meiser

Ken Meiser

The Consumer Financial Protection Bureau (CFPB) has identified that approximately 45 million consumers are either credit invisible or unscorable by major credit bureaus. People who don’t have established credit face several obstacles; many may be unable to get approved for credit and those who do get approved will likely face lower quality credit offers, including higher interest rates.

In September of 2018, the CFPB released a report that introduced a new angle on the plight of the credit invisible consumer. They identified two groups with a higher likelihood of remaining credit invisible or, in other words, were “persistently unscorable”— (1) individuals who remain credit invisible past the age of 25 and (2) individuals in rural areas or “credit deserts” – geographic areas with limited access to traditional financial services.

The latest CFPB research demonstrated that while consumers younger than 25 make up a disproportionate share of credit invisibles, credit invisibility appears to be less of a barrier to credit access for these consumers. The data uncovered suggests that more than 90 percent of 18-29 year-olds transition out of credit invisibility before they turn 30.¹ Of particular concern is the CFPB’s focus on the remaining 25-29 year olds whose credit invisibility appears to be persistent.²

Over the past several years, legislators have been actively advocating for new laws that promote financial inclusion and there has been a strong push to spur economic growth by helping make the credit invisible, visible. The recent CFPB findings demonstrate that gaps remain in accessibility to credit and that there are specific segments of U.S. consumers who are impacted more heavily. Therefore, we wanted to learn more about the new phenomenon of the persistently unscorable and the potential benefits of alternative credit data when scoring this population.

ID:A Labs, the research arm of ID Analytics, conducted a study that examined applicants across multiple industries to determine if the groups identified by the CFPB as having the highest incidence of being persistently unscorable truly are credit inactive, and if they have a more difficult time accessing credit than other invisibles. To learn what we discovered read, Making the credit invisible, visible: A study on the benefits of alternative credit data.

Is your enterprise using an alternative score to find more creditworthy customers? Many credit invisible consumers are seen managing credit responsibilities in non-traditional industries and may be scored via alternative data scores. If you would like to learn more contact us or visit


Ken Meiser is Chief Compliance Officer at ID Analytics


1. Kenneth Brevoort, Jasper Clarkberg, Michelle Kambara, and Benjamin Litwin, “Data Point: The Geography of Credit Invisibility,” The Bureau of Consumer Financial Protection’s Office of Research, September, 2018, (accessed April 15, 2019).

2. Ibid.