Reviewing Educational Data Use in Credit Decisions to Prevent Bias.
This law mandates the Bureau of Consumer Financial Protection (BCFP) to annually assess how financial institutions use educational data (such as grades, majors, or college attendance) when determining creditworthiness. The goal is to ensure that these practices, especially algorithmic ones, do not result in unfair discrimination against citizens seeking loans. Citizens will gain greater transparency regarding which educational details influence their credit opportunities.
Key points
Increased Transparency: The government will check if your grades, major, or attendance at a specific school unfairly influence your credit score or loan approval.
Protection Against Discrimination: The assessment aims to prevent practices where individuals with certain educational backgrounds are unfairly denied credit (educational redlining).
Public Disclosure: Findings and a list of companies using this educational data will be made publicly available, increasing lender accountability.
Expired
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