Phone Payment Data Grows in Value & Availability

Amy Hou  |  June 5, 2018   |  Credit & Lending  


It’s no secret that Americans are addicted to their phones — nor is it a habit restricted to Americans. What is lesser known, however, is what this addiction means for sources of consumer payment data. That’s changing. Mobile phone payment data is becoming an increasingly fruitful source of data on consumer behavior and credit risk assessment. Luckily, it’s also increasingly easy to find.

Americans Choose Their Phones

A recent analysis from Bloomberg discovered that when given a choice between paying monthly phone bills or paying off auto loans, Americans are choosing their phone bills. Delinquency rates on auto loans have increased by 18.7 percent over the past five years. While less data is available on delinquency rates on phone payments, investors are already putting their money on phones. Bloomberg found mobile phone loans to be a fast-growing sector of the asset-backed securities market.

When we consider how ubiquitous cell phones have become in our daily lives, it comes as no surprise that cell phone payments are a top priority to consumers. With access to ridesharing services like Uber and Lyft, phones can even replace the service that cars provide. Mobile phones are now central to everything from streaming music and movies to payments and banking.

Unlocking the Value of Mobile Phone Payment Data

Not only is mobile phone payment data growing in availability from consumer trends, but it’s also growing in value. McKinsey identifies data from telecommunications providers as one of the most promising sources of alternative data. Monthly payments on phone bills are common among consumers and represent a reliable record of the consumer’s ability to repay a loan.

Out of various sources of alternative data, mobile phone bills are also among the most accessible. Our recent report, Breaking Through to Generations with Better Data, found that access to mobile phone payment data is particularly widespread for Generation Z, which will quickly grow to be a significant portion of the borrowing market. According to the survey results, Gen Z and millennials are also the most likely to be willing to share their alternative data with a financial institution.

If there’s any silver lining to our possibly unhealthy reliance on our phones, it’s the value we can attain from them. Mobile phone payment data has the potential to predict credit risk and vastly improve access to credit for millions of consumers, as a reliable, accessible source of alternative data. All we need to do is unlock it.

Learn more about unlocking the value of alternative data for credit scoring here.

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About Amy Hou

Amy Hou is a Marketing Manager at Urjanet, overseeing content and communications. She enjoys writing about the latest industry updates in sustainability, energy efficiency, and data innovation.

Tags   Alternative Data   |   Credit   |   Risk Assessment   |   Urjanet   |   Utility Data   |