Increase Utilization of Non-traditional Credit Information in Congress

Increase Utilization of Non-traditional Credit Information in Congress

In an effort to expand credit access and improve financial inclusion, particularly for underserved populations, several legislative acts have been proposed in the United States. As of mid-2025, the Financial Inclusion Act of 2021, Comprehensive CREDIT Act, and Credit Access and Inclusion Act are underway, aiming to promote the use of alternative credit data.

The Financial Inclusion Act of 2021 seeks to broaden credit accessibility by incorporating alternative data sources, such as utility payments and rental history, into credit scoring. This move aims to help individuals without traditional credit records gain fair access to loans and financial products.

The Comprehensive CREDIT Act focuses on comprehensive reform in credit reporting or access, likely emphasizing inclusive credit reporting frameworks that factor in non-traditional financial indicators.

The Credit Access and Inclusion Act concentrates on the unique challenges faced by gig economy workers in accessing credit. The Act aims to enable the use of alternative credit data reflecting gig work patterns for a more accurate assessment of credit risk, promoting inclusivity for those marginalized by conventional credit systems.

In the broader context, the financial regulatory environment is engaging with alternative data and fintech innovations to improve credit access and inclusion. Regulatory scrutiny on AI underwriting models aims to prevent discriminatory impacts based on race or immigration status while supporting new data-driven approaches to credit.

The Federal Reserve, FDIC, and OCC have proposed reverting to a previous Community Reinvestment Act rule to continue encouraging credit provision to underserved communities, indicating ongoing regulatory focus on equitable credit access.

Academic studies emphasize the need for a "data-driven, inclusive, and reflective" credit system aligned with modern labor market realities, such as gig economy work.

While specific recent updates on the legislative progress or enactment status of these acts are not available, their shared aim is to use alternative credit data (like gig income, rent payments, utility history) to promote financial inclusion by expanding credit access beyond traditional credit bureau data.

Traditional credit scores are primarily based on financial borrowing and repayment history. Making alternative data available to traditional credit bureaus can result in fewer bad loans, according to a 2015 study by Experian. Allowing rental payments to expand credit data benefits consumers who do not own homes.

However, regulatory uncertainty about data sharing and outdated privacy laws are major barriers to the use of alternative data. As per the Federal Privacy Act of 1974 and other privacy laws, the U.S. Department of Housing and Urban Development cannot report on-time rental payments without prior consent. Telecommunication and utility firms only report late payments to credit bureaus, and no law explicitly permits them to report on-time payments.

Despite these challenges, 89 percent of lenders find that alternative data allows them to extend credit to more consumers. Cash-flow data can help determine risk more accurately in creditworthiness assessments. Less than 0.3 percent of loans were underwritten using alternative data from 2016-2020.

Structural inefficiencies at credit bureaus mean that lenders must manually underwrite loans that use alternative data because automated systems do not currently accept non-traditional data types. The Comprehensive CREDIT Act allows payment history of rent, utilities, and telecom services to be furnished to the credit reporting agencies.

The Consumer Financial Protection Bureau (CFPB) considers 26 million consumers as "credit invisible," and 19 million as "unscorable." The CFPB has been updating definitions to create more flexibility for lenders primarily with rental payment data.

In conclusion, while the exact status of the Financial Inclusion Act of 2021, Comprehensive CREDIT Act, and Credit Access and Inclusion Act is not clear, their goal is to use alternative credit data to promote financial inclusion. If you need precise bill text, legislative progress, or official status updates, consulting government legislative trackers or congressional records directly would be necessary.

1. The Financial Inclusion Act of 2021 and the Comprehensive CREDIT Act aim to implement inclusive credit reporting frameworks, using alternative data to foster fair access to loans for individuals without traditional credit records.
2. The Credit Access and Inclusion Act focuses on promoting credit access for gig economy workers, and it seeks to do so by enabling the use of alternative credit data reflecting gig work patterns in credit risk assessments.
3. Regulatory bodies in the United States, such as the Federal Reserve, FDIC, and OCC, are examining AI underwriting models and encouraging the use of alternative data for credit provision in underserved communities, as per the Community Reinvestment Act rule.
4. Despite challenges concerning data sharing and privacy laws, 89 percent of lenders find that alternative data allows them to extend credit to more consumers, as a 2015 study by Experian suggests, and this data can provide a more accurate measure of creditworthiness.

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