On the Rise of FinTechs – Credit Scoring using Digital Footprints

Tobias Berg, Valentin Burg, Ana Gombović and Manju Puri

No 24551, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We analyze the information content of the digital footprint – information that people leave online simply by accessing or registering on a website – for predicting consumer default. Using more than 250,000 observations, we show that even simple, easily accessible variables from the digital footprint equal or exceed the information content of credit bureau scores. Furthermore, the discriminatory power for unscorable customers is very similar to that of scorable customers. Our results have potentially wide implications for financial intermediaries’ business models, for access to credit for the unbanked, and for the behavior of consumers, firms, and regulators in the digital sphere.

JEL-codes: D12 G20 O33 (search for similar items in EconPapers)
Date: 2018-04
New Economics Papers: this item is included in nep-ict, nep-mkt, nep-pay and nep-rmg
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Citations: View citations in EconPapers (20)

Published as Tobias Berg & Valentin Burg & Ana Gombović & Manju Puri & Andrew Karolyi, 2020. "On the Rise of FinTechs: Credit Scoring Using Digital Footprints," The Review of Financial Studies, vol 33(7), pages 2845-2897.

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Journal Article: On the Rise of FinTechs: Credit Scoring Using Digital Footprints (2020)
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