Alternative Data and Credit Scores: Will it Trigger CFPB Enforcement?

The Consumer Financial Protection Bureau ("CFPB" or "Bureau") recently announced an effort to better understand how "alternative data" could be used to expand access to credit. Through a formal notice and request for information just published, the CFPB is trying to learn more about the potential to use of what it calls "non-traditional" or "alternative" data points to develop credit scores.  These data items include occupation, length of time in a particular job or residence, behavioral data, such as shopping habits, and information about consumers' friends and associates gleaned from social media networks (among other things).  The CFPB believes that use of this data could help provide credit scores to the "credit invisibles" – the roughly 45 million Americans who have limited, stale, or no credit history – and potentially move those consumers into mainstream credit products with more affordable terms. While not the CFPB's current area of focus, they also