The discussion led by Neil Munroe was based on the ICCR report “The Use of Alternative Data in Credit Risk Assessment: Opportunities, Risks and Challenges” (2025), which examines the integration of alternative data sources into credit risk models. The report highlights the opportunities for promoting financial inclusion, the risks to be addressed, and necessary policy measures.
Key topics of the sessions:
▶️ Data innovation: Use of alternative data through digitalization to support access to credit, transparency and trust, as well as data protection and consent models.
▶️ Data integration: Collaboration between traditional credit reporting systems and fintechs, telecommunications companies, e-commerce providers, etc. to improve data quality, transparency, and trustworthiness.
▶️ Data policy: The role of policy in balancing innovation and consumer protection, as well as the discussion about market- or regulation-driven approaches.
‼️ Key Takeaways:
📌 Alternative data enhances traditional credit information in helping underserved consumers and small businesses access finance.
📌 Highly predictive types of alternative data include telco, utility and ecommerce transactional data.
📌 Effective integration of alternative data relies on identifiers like national or digital IDs and company IDs, which serve as entry points for accessing finance and enabling cross-border data sharing.
📌 Addressing bias and “data hallucination” is a crucial topic when considering the use and regulation of such data.
📌 The use of alternative data requires the implementation of a well-balanced regulatory framework that promotes innovation, trust, transparency, and consumer protection, all vital for the provision of sustainable and inclusive access to finance.
Source: LinkedIn
