TECH TALK: DATOS INSIGHTS & AFFIRM

A smarter model for lending today

While traditional credit bureau data is still a crucial tool for risk assessment, its limitations have become increasingly apparent: 60 million Americans don’t fit into the traditional credit lens, representing a missed opportunity for lenders. Moreover, 60% of consumer lenders feel somewhat or less confident making loan decisions solely on traditional credit data.

As a result, cash flow underwriting is becoming a normalized part of the credit underwriting process. Cash flow data and insights provide lenders with a more complete picture of a borrower’s financial profile, allowing them to approve more loans, expand access to previously credit-invisible consumers, improve decision accuracy, and enhance portfolio performance—all while reducing risk.

On the heels of Plaid’s dedicated study with Datos Insights, Plaid Credit Product Lead Michelle Young spoke with Stewart Watterson, Strategic Advisor at Datos Insights, and Don Lemire, Vice President of Credit Analytics at Affirm, about cash flow underwriting’s transformative impact, tactical considerations, and key role in an increasingly unpredictable economy.