{"id":3262,"date":"2025-03-26T12:01:47","date_gmt":"2025-03-26T01:01:47","guid":{"rendered":"https:\/\/www.begini.co\/?p=3262"},"modified":"2025-07-31T11:28:08","modified_gmt":"2025-07-31T01:28:08","slug":"what-is-alternative-data-and-how-can-it-improve-credit-scoring","status":"publish","type":"post","link":"https:\/\/www.begini.co\/es\/what-is-alternative-data-and-how-can-it-improve-credit-scoring\/","title":{"rendered":"\u00bfQu\u00e9 son los datos alternativos y c\u00f3mo pueden mejorar la calificaci\u00f3n crediticia?\u00a0"},"content":{"rendered":"\t\t
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What is Alternative Data and how can it improve credit scoring? <\/h1>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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For decades, traditional credit scoring models have relied on a narrow set of financial data – primarily past loan repayments, credit card usage, and banking history. But in emerging markets, where millions lack access to formal financial services, these models leave many individuals and businesses without a reliable way to prove their creditworthiness.\u00a0<\/p>

This is where alternative data is transforming the lending landscape. By leveraging behavioural insights, mobile usage patterns, utility bill payments, and other non-traditional indicators, lenders can build a more comprehensive and inclusive picture of a borrower\u2019s financial habits. This shift is enabling financial institutions to reach previously underserved populations while maintaining sound risk assessment practices. In many countries, this movement is being accelerated by Government-backed initiatives.\u00a0\u00a0<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Understanding Alternative Data: What does it include?\u00a0 <\/span><\/h2>

Alternative data refers to non-traditional sources of information that can help lenders assess credit risk. Some key examples include:\u00a0<\/p>

\ud83d\udcf1 Mobile and Digital Footprint<\/strong> \u2013 Payment history for phone bills, data usage patterns, and mobile money transactions can indicate financial discipline.\u00a0<\/p>

\ud83d\udca1 Utility and Rent Payments<\/strong> \u2013 Consistently paying electricity, water, or rent bills on time can be a strong indicator of creditworthiness.\u00a0<\/p>

\ud83d\udcca Transactional Behaviour<\/strong> \u2013 Small but regular financial transactions, such as e-commerce activity, digital wallet usage, or ride-hailing payments, can show income stability and spending habits.\u00a0<\/p>

\ud83e\udde0 Gamified Psychometric Assessments<\/strong> \u2013 Short, interactive tests can measure traits like risk aversion, reliability, and conscientiousness to help build a borrower\u2019s profile.\u00a0<\/p>

By incorporating these insights, lenders can go beyond the traditional \u201cyes or no\u201d approach and make smarter, more nuanced lending decisions.\u00a0<\/p>

Character Data: Privacy-preserving, predictive credit insights\u00a0<\/h3>

One of the most promising forms of alternative data is character-based data, derived from psychometric assessments. These assessments provide first-party, opt-in data that measures psychological traits like responsibility, risk aversion, and financial discipline\u2014all without requiring traditional personal or financial information.\u00a0\u00a0<\/p>

Because psychometric assessments evaluate inherent behavioural traits rather than external financial histories, they offer a fairer and more accurate measure of a borrower’s true risk profile. Furthermore, as these assessments do not rely on sensitive financial details, they align with global data protection standards such as GDPR and other emerging privacy regulations, ensuring compliance while still providing actionable credit insights.\u00a0<\/p>

Modern psychometric assessments are a long way from the multiple-choice questionnaires of the past. Begini offers a gamified character assessment based on psychometrics that ensures high completion rates and favourable user experience. By using games and tasks \u2013 not questions \u2013 we assess people on how they think and learn, not what they tell us about themselves. Don\u2019t ask people about their behaviours, allow them to show you, that is the power of modern character assessments.\u00a0<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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