As you might remember, I wrote two blogs about alternative data, as an effective way to better score people with no or only a small credit history. One was “Psychometrics in credit Analysis – threat or promise?” where I reflect on a presentation by the Entrepreneurial Finance Lab (EFL), a US alternative credit scoring company spun out of Harvard University. Please find a one pager on EFL and on their products. The other one was “A US study: Utility and telecom payment data predict loan repayment capacity!” Since my time at CGAP I think the topic is super exciting and opens a lot of doors to significantly increase well-structured lending to low-income population segments.
To remind everybody: EFL uses psychometric data to develop credit score creating creates a deep quantitative understanding of individual risk and opportunity in small business (MSME) and consumer financing.
