How Utility Bill Data Improves Credit Scores


There’s a revolution going on in the credit markets, and the lowly utility bill has an important role to play. Here’s the scoop: Credit scores are very useful, helping providers of mortgages, credit cards and auto loans to quickly assess repayment risk. While 184 million Americans have a credit score, a whopping 54 million do not.1

On the positive side, two-thirds of the unscored adults could be scored if more data were added to their credit files.2 In the past, utility bill payments were included in credit data files only if payments were so overdue they had been sent to collections. Now, with recent innovations, many of the current credit scoring models include a complete payment history for the past 24 months.

97% of consumers adding utility payment history saw their credit score increase, typically by 20 points.2

10 million of the unscored will have scores of 600 or more.3

2.5 million newly scored adults would qualify for a mortgage.4

More scores means more business. Many unscored adults simply lack sufficient data in their credit files. Unscored does not equal bad risk. Earnest, SoFi, Upstart and others know this. Millions of adults are afraid of debt, and therefore avoid taking it on. This leaves them with little credit history for when they really need it.

For a mortgage broker helping a new home buyer, or a PACE or solar contractor wanting to qualify a prospective solar customer with marginal credit, adding a good utility payment history can fill out a credit file, raise the score and qualify the buyer.


Expanded data means better default predictions. Lenders also benefit from adding utility bill payment data to credit files. PERC, a non-profit focused on financial inclusion, reports that utility bill data increases the precision of mortgage default models, over and above credit score data.5 Zest Finance and Revolution Credit, both users of expanded data sets, report that increased precision in default predictions has led to loans with 54% and 40% fewer defaults respectively.6, 7

It’s a virtuous flow of events: Consumer adds utility data which raises their score, added data leads to increased precision of default predictions, lower defaults are realized, and the cost of borrowing falls for consumers who provide utility data.

Here at WattzOn we’re proud that our nationwide utility bill data software platform can increase access to credit for so many Americans.

WattzOn’s Link API provides validated utility bill payment histories, including 24 months of bill pdfs and a structured data file.  Data is automatically updated each month.  And WattzOn’s Snapshot increases consumer access, enabling a user to simply take a photo of their utility bill; then WattzOn’s machine learning algorithms instantly scan the image and extract data which is returned via API.

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