Banks may very soon rely on your school grades, driving habits, shopping habits and tax payments to appraise your capacity to borrow or absorb a credit. These nontraditional metrics apparently help a lot in judging a borrower’s behavior in the long term, according to industry experts. Risk analysts term these metrics as “responsibility” scores.

How are these scores arrived at? Let us see this example – A person who pays all his utility bills is more likely to follow his exercise regimen in a gym. This accomplishes his objective of weight loss and demonstrates his responsibility. A habit like this ranks him well in his responsibility score.

Nowadays, lenders harvest huge amounts of borrowers’ financial data to assess risks associated with credit, but the need for a broader read and more comprehensive social profile of people is imminent. Industry leaders like SAS are already working towards this by surveying a number of Americans in order to investigate and infer their behavioral patterns in daily life. Lenders may one day take into account lots of nontraditional metrics, such as whether the borrower has a good reputation on eBay or pays cell-phone bills on time before deciding whether to extend credit.

Borrower’s appetite for credit – not for their ability to afford the risks was something banks were glued into till now. However, the credit crunch has pushed analysts to paying more attention to newer risk models that call for more revenue projections from each borrower. In future, the responsibility scores may well earn you admission in a reputed college or employment in the same.

Social statistics would always be subjected to privacy laws and regulations. Even so, analysts are highly skewed towards introducing new risk analysis models. So, do we need to be a little paranoid with the thought of borrowing? Well, I would say…just act responsible!

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