How lenders are driving profitability across the loan lifecycle with alternative data

Fintech lenders are increasingly relying on alternative data to drive profitability across the loan lifecycle, shifting from a focus solely on top-level growth. They use alternative credit data to help customers with financial challenges and improve servicing and collections activities by identifying customers who qualify for loan modifications or deferments. By engaging borrowers after loan origination, lenders can increase lifetime value (LTV), reduce customer acquisition costs, and offer tailored products to their existing customer base. Many fintech lenders are now using artificial intelligence (AI) to optimize alternative data, such as creating predictive scores to forecast default rates and improving customer service through AI-powered phone support. By leveraging alternative data, lenders can better serve customers, increase loyalty, and decrease default rates.