TransUnion Live – How Credit Monitoring Empowers Consumers and Enables Financial Inclusion

Consumer credit monitoring, a credit education tool associated with greater financial inclusion, has expanded considerably in awareness and usage over the past decade, and even more so in recent years. Watch our on-demand TransUnion Live where we examined the distinct profiles, motivations and future financial outcomes of credit monitoring consumers based on a recent TransUnion study, and discussed how to apply the findings to business strategies. For a more detailed look into these insights, read the full report — Credit Education | Empowering Consumers: Enabling Financial Inclusion.

Full transcript below:

Andrew Goss/Host, TransUnion:

Welcome, everybody, to another exciting episode of TransUnion Live on LinkedIn. I'm TransUnion's Andrew Goss/Host, TransUnion, and I'm excited to be joined by my esteemed colleague, TransUnion's Head of Consumer Interactive, Lindsey Downing/SVP Consumer Interactive, TransUnion. And I am especially excited to have Self Financial's Chief Strategy Officer, Chris LaConte, join us as well. Welcome, you two.

Chris LaConte/Chief Strategy Officer, Self Financial:

Thank you. Glad to be here.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Thanks, Andrew. Yep, excited to be here.

Andrew Goss/Host, TransUnion:

Yeah. Today we're going to explore what TransUnion recently uncovered regarding the distinct profiles, motivations, and future financial outcomes of credit monitoring consumers, excuse me. We'll discuss how to apply the findings, as well as other financial education tools, to business strategies.

Now, before we get started, I have a quick housekeeping item I always start off with for the audience. We welcome your questions as long as they're related to today's conversation in the comments area. If they're applicable and we don't get to them, we'll do our best to respond to you right afterwards.

So, let's get started. Chris and Lindsey, again, thanks for joining us. First off, I think it's always best to get the lay of the land. Can you two share with us your definition of financial inclusion and credit education so we're all really singing from the same song from this point forward?

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Sure. Thanks, Andrew. I'll lead us off. When I think about financial inclusion, I think about enabling responsible and equitable access to financial services and really empowering consumers to participate in the credit and financial ecosystem. But in order to be included in mainstream financial credit and systems, consumers first must know where they stand. Where does their credit stand today? How do they change their situation? How do they better change their situation, which is where credit education comes into play.

To me, I think about credit education and empowering consumers, it means providing them with access to information, tools, content that does truly help them understand all the puts and takes of the credit score, the credit models, the credit factors. The two really go hand in hand. And lastly, I think it's important that making credit education available via diverse channels and ensuring it's tailored to consumers across a variety of credit circumstances ultimately helps more consumers know where they stand today from a credit perspective and understand what actions they can take to reach their financial goals in the future.

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah, I would agree especially on financial inclusion in the definition. For me, and I think for Self, we think about it as access, so making sure that everybody has access to the traditional financial system, especially those that have been historically marginalized or felt excluded for one reason or another.

Then, on credit education, it really depends on where you are at in your own credit journey. Educating is different, obviously, from any perspective. You want to have relevant information for where you are today.

So for us, we did a survey to get a sense of where our customers are. We found that 72% of our customers told us that they've had little to no financial education ever. and our average customer's 34. So this isn't people who are just coming out of high school, things like that. These are adults with jobs. A lot of them have families. We've taken that step on like, "Okay, how should we educate people from that perspective?"

And at the end of the day, credit's complicated, I mean, for anybody. I mean, if you look at how a credit score is calculated, there's five different major factors that are weighted on different percentages. And what does that actually mean? We try to take a simple view with our customers and communicate clearly based on where they are today in their credit journey.

Andrew Goss/Host, TransUnion:

Great. That's a great base to work from. Moving on, I talked a little bit about this credit monitoring study that TransUnion did. I think this question is going to probably be more geared toward Lindsey. But Chris, I think you'll probably have something to say here as well. But Lindsey, can you get to an overview of that research I mentioned? Why was this study conducted? What did we analyze? We can get to the specific findings in subsequent questions, but set the stage for us there.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah. Sure. I'd be happy to. This study is part of the great portfolio of work that TransUnion's research and consulting team produces each year. The primary objective of this study in particular was to better understand consumers who use credit monitoring solutions and the outcomes that they see, the behaviors they have, the outcomes they see. These insights are helpful to consumers but also to the business customers that enable these solutions as they look to launch or enhance their credit education programs and evaluate their own financial inclusion strategies.

This study, it was global. We focused primarily on the US here in a lot of ways, but it was a global study, and it looked at distinct profiles, motivations, and future outcomes of credit monitoring consumers by examining millions of people who started monitoring their TransUnion credit report between a period of July 2021 and June 2022. So, we kind of tried to take a snapshot in time.

And when we think about that population, it's anybody who's able to access monitor, look at a TransUnion credit report, which could be through directly through TransUnion or through a number of the partners, such as Self or other places, where they might be able to monitor and look at their credit information.

Then, these consumers were compared to a population of consumers who had never monitored their credits. We try to create kind of a base population, a sample size, and then compare to that to those that have engaged with some of the credit monitoring and education tools that TransUnion provides. That was kind of the foundation of the study and why we did it.

Andrew Goss/Host, TransUnion:

Okay, great. Chris, do you have anything else to add there or shall we move on?

Chris LaConte/Chief Strategy Officer, Self Financial:

I think one thing that I remember seeing in the study was just... I think it was 70% plus, Lindsey, of people were there to achieve or had a goal and wanted to use this to help them get it. Is that right, like kind of how the breakdown was?

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah. As you segue and preview into some of the later points of the study, there was three main groups of consumers that we identified, motivation groups. There was credit improvers, there was credit seekers, and there was credit managers. As you can imagine, credit improvers are consumers with subprime scores. They're likely checking their credit to understand where they stand and then take steps to either cure delinquencies, lower their debt ratio. They're really trying to improve that score.

That middle bucket is credit seekers. They have healthier credit. They're at near prime or better, and they intend to open a new credit account of some sort in the next 12 months. Then we had a third bucket, which was credit managers. They also have scores in the mid near prime to above prime. They're not really looking to open new credit. Perhaps they're looking, like I said, to pay down balances. We also believe this is a population that's more focused on protecting what they have and focusing on education and monitoring tools, also make sure that they're protecting their identity. Those were kind of the three buckets of consumers that we saw within the study. Then, we can dig into each one of those and talk about how we see those consumers and potentially how Self interacts with them as well.

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah, I thought that point was super interesting. Just, I've always historically... And I worked at a cybersecurity company shortly before this, and it's always been monitoring focused. So to know that 70% of people who want monitoring are actually there to improve or achieve I thought was a really interesting highlight.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yep.

Andrew Goss/Host, TransUnion:

Cool. Yeah. Well, again, that's good. We're working from a good base here now. Let's get into some of the findings in the study and then, obviously, some of the experiences that Chris has had at Self. Let's start with some of the characteristics of consumers who are actively working on their credit. What did we find? We've talked about the segmentation a little bit, but some of those characteristics, what do those consumers look like?

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah, I can start off. And Chris, you can certainly add in. Looking back at the study that we just mentioned, typically what we found with the consumers who monitor their credit, they skew toward the younger age cohorts and riskier credit score segments than those who do not monitor. Specifically, this study found that 53% of credit monitoring consumers are in that Gen Z and millennial age cohort, putting them between 18 and 43. Which Chris, I think in his intro, mentioned something about we have 34-, 35-year-olds that have never really had formal financial education. That's kind of the cohort that we're seeing that is interested in learning more and it's our job as an industry to help make sure they understand where they stand and how to better their situation. It was 53% kind of fall into the Gen Z, millennial versus our sample size where only 24% of the non-monitored population fell into that.

Then similarly, roughly half of the credit monitoring consumers have credit scores that fall into the prime and below credit segments, so 720 on the VantageScore floor model is where we sell them. So they're a little bit younger, they're a little bit riskier, so it highlights an important fact. There is a population out there that has the need for services that I think TransUnion and Self have been partnering together to bring to the market. But Chris, I'm not sure. Is there anything else you would add there on what you see in those that participate in your programs?

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah. No, we're definitely in the credit improvers, credit seekers category. We survey people when they come to Self and say, "Why are you here? How can we help you?" 70% plus are like, "I'm here to build credit," which is a fairly generic answer.

I actually took some customer service calls. I'm wearing a shirt from those of us who took customer [inaudible 00:10:57] at the executive level. I talked to this gentleman, and he was like, "I want an 800 score. You're helping me get there and all this stuff, and I want to understand it." Then, he asked me at the end of the call, "What happens when I get to 800? What does that world look like?" It was interesting that he wanted to achieve. But even when he got there, he wasn't exactly clear of what that does for him.

About 70% of our customers are looking to just generically achieve, and then we have very specific goals after that. Right after that was 50% are saying, "I want to buy a home." When we look at our population, roughly... I think it's like 70% plus are considered renters. A lot of them are aspirational homeowners. Some were, "I want to buy a car." Then you get into the more nuanced, "I want to refi something. I want to pay less."

Our group, people are coming to Self are very thoughtful about an individual item they're trying to achieve in general. So that's where the education obviously comes in. What does it mean? Where do you need to get to there, and how do you do that?

Andrew Goss/Host, TransUnion:

Cool. That's interesting. Again, we're building from this base here, I feel like how the conversation is going. I think Lindsey got into this already with the segments of these credit monitors, but what are some reasons upfront that consumers monitor their credit? If you want to expand a little bit on that, those segmentations already, Lindsey, or let me know if we kind of got to where-

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah. I think however you segment them, we talked about improvers, seekers, and then managers. As Chris was saying, especially in that improvers segment, they want to improve... Maybe they want to improve because they want the gold star on their back. But most likely they want to improve because they want the car. They want the house. They want to access the goods and services, and they understand that credit is a means to doing that.

Some of the tools that we provide simulate, "Hey, if I open this account, what happens to my score? If I pay down this account, what happens to my score?" There's a lot of actions and reactions that consumers need to understand if they're truly trying to get to a different place through the tools that we provide."

So if I think about some of the benefits, you're looking at some of the outcomes. Do their motivations of credit monitoring actually materialize in better financial inclusion? Some interesting facts that we found. Credit monitoring improvers, people that are monitoring their credit, they have a higher cure rate. They pay their debt down faster. They are actually better financially or showing up better financially because they are understanding where they are and they're taking actions to change that situation.

Specifically, 34% of our monitoring improvers, they cure delinquencies 12 months after enrollment compared to only 29-ish-percent of the non-credit-monitoring improvers. That's telling FIs, or whomever, that people that monitor their credit are taking care of the obligations that they have. So when you look at your population, understanding who's monitoring and who's not is a helpful data point for financial institution.

We also saw that seekers... Remember, the seekers that are ones that are looking for credit. Again, we talk about that simulator that I mentioned. We've seen when consumers interact with that, they are much more likely to open credit down the line, so we know that they're actively seeking credit. And we see that credit-monitoring seekers had about 1.16 times more originations than non-credit-monitoring seekers. These are just some of the findings of the studies that kind of talks about those different segments and then what we see from their behaviors and their outcomes.

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah, it's a huge part of what we do. I mean, the numbers you mentioned are very similar for us. But people are coming here high credit seekers, and then we look at what the outcomes are after they've been, so credit monitoring.

We did some research and that our consumers were five and a half times more likely to open up a credit card after working with Self than before. And that goes to the credit-seeking side. A lot of them are coming in either don't have a card or made mistakes before and no longer have a card. We see those types of outcomes. I think it's three and a half times more likely to get a personal loan, one and a half times more likely to buy a car. It's nice to see the combination of why they came here using monitoring as a point to educate them about what they can do to make sure they're kind of building and understanding credit in the right way. And those monitoring tools are incredibly important, especially the simulators, which are super interesting, where you can go and say, "I want this. This is the score I want. Here's some of the things you can do." It's really useful.

Andrew Goss/Host, TransUnion:

Okay. Well, Lindsey touched on this a little bit, and I feel like... But we definitely got to the upfront why are consumers starting to monitor their credit. But there was some eye-opening stuff when I skimmed through this study. The long-term, what are the benefits that consumers realize when they monitor their credit over time?

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah, I can say just on utilization, I think on the understanding side, one of the areas we focus on is utilization, help people understand that and how to manage that. Over time, obviously, they can see when they pay their bill on time or what their utilization was when that gets reported, what that difference was. So we can really see the impact of people having lower utilization if they're monitoring, just they're understanding what that impact can be. That's such a dynamic monthly thing that can have a fairly large impact. It's really interesting to see how quickly they react to that. That's one thing that's really stood out to us.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah. And just to build on that, I think that monitoring is just part of a broader selection of tools that consumers can use. Because I think we think of credit... It really is around financial wellness. A wellness is all around financial health, and credit is a huge component of that. I think the benefit is if you think about the different places where your financial life shows up, there's an asset side or there's a debit side, there's a credit side. We focus a lot on the liability side, which is a nice compliment to perhaps other tools that are out there, and I think Self has some of those tools. But the benefits to me are understanding that as part of a larger financial wellness picture. It can't be only focused on one segment of your life. But understanding how that liability side of your balance sheet works to me is critical as part of a larger financial wellness approach that I think is important for consumers to think about.

Andrew Goss/Host, TransUnion:

Interesting. I know you went a little bit beyond credit monitoring there, Lindsey. But for the bulk of our conversation, so far we've focused on credit monitoring. Let's get into some of those additional credit tools, credit education tools a little bit more. What can support financial inclusion?

Chris LaConte/Chief Strategy Officer, Self Financial:

I can go first.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

[inaudible 00:18:07] say.

Chris LaConte/Chief Strategy Officer, Self Financial:

[inaudible 00:18:08] bunch of different stuff on credit education. Part of it's in-app, part of it's also meeting people where they are. So if you look at a lot of our credit education, a lot of it actually happens outside the app. We're very active in social channels and most of the communications that we have are what credit is, how credit works. We've got a YouTube channel that's got 10,000-plus subscribers. Some of the videos have... Just looked at one the other day that's got like 40,000, 50,000 views. And it's just, "What is credit? How credit works."

We hired an individual, Monique, actually, from Operation Hope where she was a coach there and had a lot of day-to-day experience, just explaining to people how credit works, how to achieve their dream of homeownership. She's created a lot of great content that's online in the channels where people are going for information today. If you look at the population that uses a lot of the credit monitoring, especially the younger group, they're not getting their information historically like others used to do from the news and things like that. They're seeking out Influencers or individuals on social channels that are experts. So, we're trying to put a lot of content there in snippets. They also want short form content, so we spend a lot of time creating that. So, that's one of the big areas.

Then, the other is when... One thing I'll say is some of the emails and the communications we have are focused on credit education. One example is utilization, which I keep going back to, but it's super important. We've got this indicator on our secure credit card that has 30%. So it's got your utilization meter, and then right at 30% there's this big 30% in red. We send an email to individuals as they actually get close to that to let them know, "Hey, you are approaching 30% utilization. This is why that's meaningful. These are the things to think about. You may want to consider to actually use a different card or use a different way to make your next purchases as opposed to putting them on the Self card."

We may be the only financial institution that's actually telling people not to use our credit card. But because we report utilization, like all real credit cards do, it's a real important part of what we're doing. And ultimately, people are coming to Self to understand credit, so we want to make sure that they can, I guess... My Mac is giving me the thumbs up. But we want to make sure that we're being truthful in communicating with them about what that is. Those are two big ways that we kind of manage that.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah. What I would just add to that, if I think about... There's got to be a balance, right? There's certain things about credit that are... Like Chris said, there's kind of five main things. No matter who you are or where you sit, those things are true.

There does need to be some generic education that informs consumers to a certain baseline. Andrew, I think you've used that word a couple of times. But then there's also something about a personalized experience. I look different than Chris. I look different than Andrew. And I want to know how I look different. I think tailoring that content and personalizing the experience so that you do feel like you're being handheld through a process as someone and not part of a collective, I think that's something else that we've really tried to focus on, is that personalization. You are a 700. You want to get to a 750. What do you, Andrew, need to do to do that?

So it's not just about education. That's a big piece of it, but I think there's also a personalization. Wherever you can personalize and customize to a person's circumstance, I think it just helps them feel like it's more relevant and tailored to them and actually helping them grow as a consumer.

Andrew Goss/Host, TransUnion:

Cool. We touched a lot on the consumer side, but let's look at financial institutions now. How do they benefit from providing this credit education?

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Sure.

Chris LaConte/Chief Strategy Officer, Self Financial:

Go ahead, Lindsey.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah, let me kick things off. We'll tag team this here a little bit. If I think about FIs in particular... This may apply to businesses across industries, but if I think about FIs, I think about three things. I think about engagement, enhanced monetization, and loyalty, so stronger engagement. If you think about the dashboard and the tools, you're giving consumers a reason to spend more time in your site, in your property, it engages them in a different way. It gives enhanced touch points in a digital kind of ecosystem.

Monetization. If you think about why those consumers are there, especially for an FI, you want to take more. You want to get greater share of wallet. You want them to be using more of your particular cards or products, so it provides a forum where you can also educate them, get them to where they need to be, and then put the right offer in front of them at the right time.

That kind of segues into the last point, which is around loyalty. We've heard from consumers and we've seen indications that generally consumers who get this information from their FI are much more likely to stay with that FI longer, so it drives some level of loyalty. Which hopefully the longer they stay with you, the more cards and loan products that they might take in and they ultimately become a well-rounded customer of yours as the Fi. I'd say it's engagement, monetization or cross-sell efforts, and then generally speaking is loyalty. But Chris, anything you'd add there?

Chris LaConte/Chief Strategy Officer, Self Financial:

No, I think that's it. I think I think about them a little bit differently, but the same three, specifically on loyalty. For us, what we've seen that's building loyalty through trust. Again, if you go back to that stat where I mentioned 72% of the people that come to Self have little to no credit education, we're building trust with them because we're communicating with them in a very open, honest, but direct way. We look back at our customer service kind of like, "Why do you like Self?" These types of things.Literally, one of the... If you think about it like an infographic on it, a big part of it is just honest communication.

Then a monetization, that's absolutely one of it. But I think you can monetize consumers in very different ways. But a consumer who understands credit and has better credit behaviors, you're going to monetize in a much more, I would say, ethical way you. You're offering them net new products that they're having good experiences with, good outcomes with, making on-time payments as opposed to late fee monetization, incredibly high interest rates, things like that. Those are two ways that we think about both those two things, but those are a hundred percent how we think about it.

Andrew Goss/Host, TransUnion:

Okay. Now that we got to some of the benefits, let's get to more of, I'd say, the tactical part of it. What are some practical tips and applications for using credit monitoring, other tools as part of a larger financial inclusion strategy for businesses?

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah, I can kick it off. I mean, we think about three different ones. One, like I mentioned before, meet people where they are. Take credit education. Maybe it's not always in your wrap, but there's other mediums where these consumers are interacting. Engage with them there. That's where they're seeking information. Not a lot of them are coming to their financial institution, logging into the app and saying, "Teach me about credit." They're exploring credit outside of that.

Two is understanding their needs. Why are you here? What are you trying to achieve? Then, obviously, like Lindsey mentioned, things like simulators and others that you can wrap around that question are just a very practical and tangible way to provide value.

Then also, know that they need help beyond what you can do. We've got a whole partnership platform. We know that we're not serving consumers. We have a lot of consumers that are graduating to the traditional financial systems. We help refer them to the right partners there. We also have partners who help people who are struggling. One of our partners helps people get in touch with local nonprofits, and a lot of what they're seeking there are help with, "How do I make my rent payments? I'm in a food desert or I've got food insecurities. How do I help those?" Childcare, things like that. Just very practical things that they're living every day. We try to have a really well rounded partnership program and know that we're not a one source that's going to find everything.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yeah. I think where I would add onto that is I think... I was going to go with more layering. There's multiple things. Credit education and monitoring, they're a solid foundation, but they're just one pillar of a financial inclusion strategy. I think where TransUnion, we recognize where we can play and where we can serve consumers, but having partnerships such as Self that reaches consumers where they are and where they want to be, that's part of the game. It goes back to, like I said, it can't all be generic. It has to be customized and personalized to somebody's individual experience and being able to really serve across that credit spectrum.

If we think about the served population and the underserved, we really want to try to focus on that underserved, try to bring them to the forefront. We do believe some of our solutions enable them to start surfacing, especially in, like I said, in partnership with Self, surfacing to become credit visible. Then, it's our job from there to make sure they get on the right track going forward. TransUnion is doing a lot of work around creating those products and leveraging our data assets that help make sure we're bringing the most full and representative view of a consumer who shows up and expects to have those services from TransUnion.

Chris LaConte/Chief Strategy Officer, Self Financial:

We just lost power here. There's a big storm outside, but Wi-Fi is still working.

Andrew Goss/Host, TransUnion:

Okay. Well, stick with us here. I've got one more question, and it's not going to be a gotcha question, at least not yet. But we've spent about 30 minutes so far talking about all these findings from the study and everything that Self has seen. There's a lot of findings, a lot of data, a lot of insights that you've provided so far. If we can cull it down into a couple key points that FI should extract from this conversation and consider prioritizing out of all the data findings... You guys are on the spot here. And feel free to pull in something that we haven't already gotten to, too, as well.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Well, I'll start, and hopefully Chris can hang on through the storm there until his turn. But first of all, going back to the study, there's a lot of great information in there, so please check that out. It's on TranUnion's webpage. But I think it's important to think about what all of this means for FI as Chris... or, Andrew, as you said.

First, I think there's still a lot of opportunity to leverage these tools to further financial inclusion. They can help consumers reach greater levels of credit, access new financial products, and manage and protect that information. We really haven't talked a lot about identity protection, but to me credit is a fundamental pillar of financial inclusion. It's also a fundamental pillar of just overall protection of your identity. Our own experiences show that many consumers do work with multiple providers for these solutions, so market opportunity is still there to make these tools available to consumers in unique ways.

And finally, consider your audience and its distinct characteristics and motivations when determining what tools to offer. Like I said, it's that balance between generic making sure everyone has the baseline and then making a customer feel like they truly are a unique individual with unique needs that you are there and prepared to serve. That'd be my tips. Chris, what about you?

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah, I would jump off the last one. Tailor it to where they are and what they're trying to achieve. I mean, people are working with a financial institution for a reason, especially on credit education. It goes back to those data points about credit seekers, credit approvers. Understand what that is, and then lay out a very easy-to-understand fundamental roadmap on how they can achieve that.

We have people who are here to get a credit card. Let's put them on a path to get a credit card. We don't need to spend time talking about things that aren't as relevant. Let's help make sure they understand it so when they have that or achieve that goal also they have positive outcomes.

Andrew Goss/Host, TransUnion:

Speaking of customizing, and I know we kind of got to this a little bit already, thank you, Chris... We have a question from the audience around Gen Zs new-to-credit people. How can you leverage, or how can someone leverage Self, the day-to-day apps that people use, Amazon, Netflix, Instagram, for credit education? I'll throw it out there. And if we're a little bit repetitive, that's fine. I just want to make sure that we're getting to this question.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Yes. Let me take it and then, Chris, I'm going to toss it to you. You talk about the data that consumers... Consumers have a lot of data. We're generating a lot of data, more and more data every day. TransUnion's goal is to take as much data as we can and represent you to the fullest ability that we can and the most accurate ability that we can.

You think about responsible behavior, we know what hits the credit report, but there's a lot of things consumers are doing that doesn't always necessarily hit the credit report or it hasn't historically. That's where I think some of the stuff that Self's doing, enabling more information to be had into the credit report enables us to score and represent a larger population of consumers. We totally agree that that data is relevant. We have to figure out ways to bring that in and then responsibly evaluate what that data might mean. But Chris, do you want to talk a little bit about some of the data reporting that you guys do outside of the traditional credit report?

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah. Yeah. We enable consumers to report their rent, telco, and utility payments. Some of these apps, or some of their fundamental purchases they're making today, it's a very tangible way for them to understand credit. If you look at rent reporting, for example, there's a hundred million people who rent roughly in the US, and only 4 to 5% of them are reporting their rent today. If you look at that population, that's their largest expense. Not being able to get the benefit of that, one, doesn't feel right.

Two, what we found is a lot of people who are coming in today as a net new customer with just rent reporting are very thin file or new to credit themselves, so it's a nice way to offer them something that they're already doing to start to understand and see what the impact of credit is, making on-time payments, and how that changes. It's taken a lot of time to get to that point, and a lot of it, honestly, for us, has had to be credit education in the market about like, "This is what rent reporting is." Sorry. We're okay here. "But this is what rent reporting is. This is why it's important. This is why you should do it." We've had to spend a lot of our time educating individuals. Again, if you look at social channels and what we're messaging right now, is trying to be very basic about what that is and how they can do it.

Andrew Goss/Host, TransUnion:

Yeah, it's great. Thanks for weathering the storm there, Chris.

Chris LaConte/Chief Strategy Officer, Self Financial:

Literally.

Andrew Goss/Host, TransUnion:

I heard some thunder come through there. I was going to add we have a study that we do regularly quarterly around what we consider alternative data, things like rent payments and how consumers think that may improve their credit score. That's another thing that we're constantly monitoring over here at TransUnion as well.

Chris LaConte/Chief Strategy Officer, Self Financial:

It's important on homeownership, right? If you look at the FHA, Fannie and Freddie are moving to, I think, Vantage 4, if I'm not mistaken, FICO 10 T next year because they saw a lot of value in rent payments. They did their own research that showed that if they had known at least 12 months of on-time rent payments before, would that have changed their underwriting or approval for that consumer. And the answer was yes. And such a meaningful amount that those massive organizations are having the undertaking of moving to a score that includes these attributes now, which obviously speaks to the efficacy of that data.

Andrew Goss/Host, TransUnion:

We didn't even touch on buy now, pay later, which is a whole other episode.

Chris LaConte/Chief Strategy Officer, Self Financial:

Yeah. That is.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

There's your teaser for your next one, Andrew.

Chris LaConte/Chief Strategy Officer, Self Financial:

I'll be listening to that one.

Andrew Goss/Host, TransUnion:

Well, I think that does it today, unless there's anything else, Chris and Lindsey, you wanted to get to or have we spent ourselves so far?

Chris LaConte/Chief Strategy Officer, Self Financial:

No, this was great. I thought the study was really interesting. Sometimes I think you could think about credit monitoring is not going to be... How interesting is that going to be? But I actually found the data in the research to be pretty enlightening. And it's made some changes on our side about our product roadmap based on it. It's really enlightening.

Lindsey Downing/SVP Consumer Interactive, TransUnion:

Nope, I don't have anything to add. I appreciate the time and Chris's partnership in joining us to have this conversation. Thank you, Andrew, for the opportunity.

Andrew Goss/Host, TransUnion:

Yeah, thank you, you two. I mean, these insights are fantastic. I learned a lot. I always learn a lot from these conversations. I hope our audience did. Thank you, Chris and Lindsey. Thank you to the audience for joining us, contributing the conversation. Even if you didn't ask a question, we're always here afterwards if you want to ask us any questions. Just the active listening, I'm sure, we appreciate.

If we didn't get to your question today, we'll do our best, again, to get back to you soon. Our social media is monitoring everything. To download findings from the recent study we discussed today, we'll be putting the web address, transunion.com/creditmonitoringstudy, and a QR code up on the screen. And you can always find the URL on the LinkedIn Live event page that you're all on right now. So until next time, we'll see you on TransUnion Live.