Lending Club CEO Renaud Laplanche revealed some of the alternative data sets that the online lender uses to evaluate credit. If you use caps lock, fill out your application quickly and past 3AM, and have a Hotmail email you should expect to get some credit score dings.
Speaking at The Economist's Buttonwood conference in Midtown Manhattan on Tuesday, Lending Club CEO Renaud Laplanche explained the factors that went into determining creditworthiness online. "We don't know what our customers look like," Laplanche said at the event. Speaking with Business Insider after his on-stage appearance, Laplanche said determining the fraudulent applicants from the real customers was a key part of Lending Club's business model. Fraudsters use automated inputs to speed up loan applications online. The faster an application is being processed, Laplanche said, the greater the likelihood it is a bot and not an actual person. Timing is key. Laplanche said on stage that Lending Club's ideal person to lend to was more likely to submit an application during regular business hours. If someone applies for a loan at 3 a.m., the person most likely poses a higher risk.