Unlocking Financial Opportunity: How Alternative Data Transforms Customer Experiences

Highlights: 

• Alternative data, including rent and utility payments, and employment history, provides a more comprehensive view of a customer's financial health than traditional credit reports, leading to stronger relationships and better outcomes.

• Integrating alternative data into account management strategies improves customer experience through personalization, enhances understanding of customer needs, and enables businesses to adapt quickly to changing financial situations, ultimately driving growth and improving customer journeys.

Financial services are evolving. In today’s competitive landscape, understanding your customer is more important than ever. That’s where alternative data comes in. 

By tapping into new data sources and combining its power with traditional credit data, businesses can unlock powerful insights that lead to stronger relationships and better outcomes for both consumers and companies.

Our latest ebook explores how alternative data is changing the game — especially in account management — and how your organization can benefit.

What Is Alternative Data?

Alternative data refers to financial and personal information that isn’t typically included in a traditional credit report. This can include: 

• Specialty finance

• Consumer-permissioned bank transactions

• Telco and utility payments

• Employment and income history

• Investment account data

These sources offer a fuller, more accurate picture of a person’s financial health and behavior.

For example, 51% of consumers believe it’s helpful to include rent payments in credit scoring because many consumers make consistent, on-time rent payments that aren’t recognized in traditional scoring models. 

By factoring in these types of data, lenders and financial institutions can better understand their customers and offer products that truly meet their needs.

Using Alternative Data in Account Management Strategies

When it comes to managing existing accounts, alternative data is a game changer. Here’s how it helps:

1. A Better Customer Experience

Customers want to feel understood — not just treated like a number. With alternative data, organizations can personalize their interactions at every stage of the customer journey. Whether it’s sending a payment reminder at just the right time or offering financial advice based on real spending habits, these tailored experiences build trust and improve satisfaction.

For example, knowing that a customer’s income fluctuates seasonally can help you time communications and offers more effectively. Or recognizing consistent utility payments might be a good reason to extend a line of credit that otherwise wouldn’t be approved using traditional data alone.

2. A Greater Understanding of Your Customer

The more complete the picture, the better you can serve your customer. By incorporating data like employment history or bank transactions, you gain insights into a customer’s real-life financial situation. This information helps you manage risk more accurately, identify opportunities, and serve a broader audience — including those with “thin” credit files or no credit file.

For instance, someone who has never had a credit card but consistently pays rent and utilities on time may actually be a low-risk borrower. Alternative data allows you to recognize and serve this type of customer more effectively.

3. The Ability to Adapt Quickly to Changing Needs

People’s lives change, sometimes swiftly. Alternative data can help you keep up. If a customer’s spending habits shift, their employment status changes, or they begin building savings, you can use this information to update account strategies in real time. This insight allows you to offer relevant services and support when it matters most.

Imagine being able to spot early signs of financial stress through spending patterns and proactively offer a flexible payment plan. That kind of quick response builds loyalty and helps prevent account delinquency or loss.

Real Results You Can See

When you integrate alternative data into your strategies, the benefits are clear:

• Personalized campaigns that engage your audience

• Faster decision-making and reduced friction in customer interactions

• Competitive, targeted offers that convert more effectively

• Better cross-sell and upsell opportunities that deepen relationships

It’s all about using data to deliver smarter, more responsive financial solutions.

Ready to Learn More?

Want to discover how alternative data can help your organization drive growth and improve experiences throughout the customer journey? Check out the eBook, Unlocking Growth Amid Uncertainty. 

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