National Credit Union Administration's Serving the Credit Invisible Report

Author: Noah Gomez
Published
: 18 December 2023

Description

The National Credit Union Administration's report on credit invisibles formally defines consumers without any credit history. Though it has limitations, this report is the primary source for ThickCredit's approach to building credit for consumers with zero payment history.


Clinical description
Controlled experiment assessing the impact of credit invisibility in the economy.

Organization

National Credit Union Administration

Authors

National Credit Union Administration

Link & Meta

Status: Published
Date: April 2016
Report Type: Report
ID: Serving the Credit Invisible Report

Insights

This study provides evidence for the following claims:

  • Approximately 26 million Americans, or 10%, are credit invisible.
  • Credit invisibles are consumers with zero credit history.

Full Abstract

"According to the Consumer Financial Protection Bureau, 26 million U.S. adults have no credit history with the three national credit bureaus: TransUnion, Experian, and Equifax. As a result, they have no credit scores.

Most consumers have a mix of credit activity, some “visible” and some “invisible.” Visible credit is reported to the credit bureau and included in the consumer’s credit score. Invisible credit is credit activity that is not reported to the credit bureau and, therefore, not included in the consumer’s credit score.

“Credit-invisibles” are consumers whose documented credit history is so limited that they don’t have credit scores or their credit scores are not based on a complete history of debt repayment. This is often because several of the payments types they routinely make are not reported to the credit bureaus. Another reason some consumers are invisible is that they are new to the borrowing scene and haven’t established a credit history.

But a credit invisible could actually have a good credit history, if she or he makes on-time payments of rent, insurance, utilities or loans obtained from an organization that doesn’t report to a credit bureau. A true repayment history may not be included in their credit scores, making their good credit history invisible.

This paper explores how credit unions can strategically tap into this under-served market and help credit invisible members increase their visibility in the traditional credit reporting system and build a good credit score."

Limitations

The report does not have limitations because it is not strictly speaking a study. It is a report on the status of consumers with zero credit history.

Similar Reports

This report is part of ThickCredit's "Public Studies & Reports" collection, which includes other governmental and non-governmental studies and reports about credit building and its products. Others include:

This report is part of ThickCredit's "Public Studies & Reports" collection, which includes other governmental and non-governmental studies and reports about credit building and its products. Others include:

This report is part of ThickCredit's "Public Studies & Reports" collection, which includes other governmental and non-governmental studies and reports about credit building and its products. Others include:

About the Author

Noah Gomez (founder of Thick Credit) is a transatlantic professional and entrepreneur with 3+ years experience in consumer finance education. He also has 5+ years of experience in corporate finance, including debt financing, M&A, listing preparation, US GAAP and IFRS.

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