At TransUnion, we recognize some consumers, including those in underbanked and underrepresented communities and developing economies, are unable to access financial resources because they have little or no credit. In order to understand our global commitment to increasing financial inclusion, we sat down with Tracie Anderson, Economic Inclusion Strategy Leader, and Jason Heil, International Credit Risk Solutions, to learn how TransUnion is helping consumers access solutions to participate in the mainstream financial system around the globe.
Tracie: Financial inclusion means the financial services ecosystem is accessible to all consumers with fair and accurately priced financial products and services. Equitable access is important because consumers’ ability to use credit empowers them to improve their financial health, fulfill their dreams and build resilience to life’s disruptions.
Several studies highlight that barriers to achieving financial health disproportionately impact women and people of color. My lived experience, and the experiences of many of my friends and family who are women and people of color, have shown how barriers limit our communities and our economy. For example, a recent McKinsey & Co. study revealed that full participation of Black Americans in the financial ecosystem would generate about $60 billion in additional revenue in the financial sector.
Jason: Having the ability to access the credit ecosystem is an important driver of economic growth, specifically in developing economies where access provides greater opportunities and builds better communities — something I believe should be attainable for all consumers in the digital age.
I’ve spent the majority of my career at TransUnion and have always felt a deep connection with our ability to provide data and insights that help consumers build brighter futures. Like many, I’ve benefited from the ability to access credit and build the future I want for myself and my family. For example, when I bought my first car that I used to drive to my first job, when I received a student loan to help pay for college and when I obtained my first mortgage to buy a home.
Tracie: If you think of financial inclusion as bridging the relationship between institutions (our customers) and consumers, then consider TransUnion as the bridge builder. Our products, people and purpose uniquely position us to advance financial inclusion through our commercial and community investments.
Our commercial investments focus on engagements with customers to increase access to equitable credit by using data to help them manage risk and grow responsibly as they engage, acquire and serve more underserved consumers. We also offer products and services that empower consumers to achieve financial health through sustainable use of credit and effective identify management.
We also elevate financial prosperity in communities through donations to sponsor the creation and distribution of credit resources that expand financial literacy and credit building activities for historically marginalized communities.
Jason: When you think of it this way, we have a unique opportunity to grow our financial inclusion strategy. Within our international markets, we’re activating a strategic framework that provides combined value for both TransUnion and lenders dedicated to serving financially excluded consumers.
What does this look like? We’re building and deploying a more holistic end-to-end solution strategy that focuses on identity fraud, credit risk mitigation and consumers tools for credit monitoring, management, and ID protection, while also reviewing and adopting new alternative data sources and exploring new partnerships. This approach will provide us with a combination of trended and alternative data solutions as a key differentiator, especially as lenders look for opportunities to expand into emerging underserved populations. It also means reducing risk and increasing the total credit population.
Tracie: There are some really positive trends in this space. First, people are leveraging greater access to information from trusted sources, which can mean they are more informed about financial services products. These empowered consumers experience greater long-term success in the financial ecosystem and improved financial health.
Second, innovations in technology have increased the breadth, depth and accuracy of data available for companies like TransUnion. This allows us to build a more comprehensive profile on more consumers, which means our customers can lend to more consumers with confidence — thereby increasing access to equitable credit.
Also, the rise of conscious consumerism — making purchasing decisions that have positive social impact — is a trend that is driving better financial performance and overall profitability for companies that embrace strategies like financial inclusion.
Jason: While consumers continue to demand greater access to information from trusted sources, TransUnion has the opportunity to provide informed access to financial services products. There’s also significant opportunity to expand our financial inclusion footprint in emerging economies with more holistic offerings and greater consistency. A more focused approach can also support partnerships with both FinTechs and more traditional verticals like banking, insurance or retail.
Jason: In addition to progress in solutions innovation and strategy, we’re working with policymakers and governments at the regulatory level to enable technologies and pathways for including financially excluded consumers in the mainstream financial system. By pursuing a multi-faceted approach to expanding financial inclusion, we’re more fully living into our mission of using Information for Good.
For more information how TransUnion is promoting financial inclusion, visit our Sustainability page.