Originally posted on LinkedIn here

Key Highlights:

• Credit access and credit education are both important to financial inclusion. Synchrony research found that while 86% of consumers say credit scores are important, only 35% feel confident explaining how credit scores are calculated.
• Alternative data and cash-flow underwriting can provide a fuller view of creditworthiness. Through Project REACh, Synchrony used alternative data and cashflow underwriting to extend credit to more than 80,000 people without conventional credit scores. More than half reached a prime credit score within a year.
• Financial health depends on both opportunity and understanding. Synchrony supports credit education through resources including Your Next Yes for people who are new to or are rebuilding credit and Empowering Financial Futures, which helps high school students build practical financial skills.

Since I began working in credit, I have focused on expanding access so more people can participate fully in the American financial system and use credit to pursue what matters in their lives.  

What I’ve come to learn is that access is most useful when people also understand how credit works, what affects their credit health and how their choices can influence the options available to them.

That is why I am proud Synchrony supports Get Smart About Credit Day, an annual American Bankers Association Foundation campaign that helps people build financial knowledge. New Synchrony research released this week shows why that work matters: while 86% of consumers said credit scores are important, only 35% felt confident explaining how scores are calculated.

We also know financial education needs to begin early. Through our Empowering Financial Futures initiative, Synchrony has committed $3 million to equip educators with training, classroom resources and Financial Literacy Labs that help high school students build practical skills in budgeting, savings and credit. 

That gap has practical consequences. People may understand that credit matters without knowing which actions can strengthen or weaken their credit health, leaving them less prepared to evaluate the financial options available to them.

Why Credit Knowledge Matters

Strong creditworthiness can help make life more affordable through better borrowing terms, provide flexibility when unexpected expenses arise and support major expenses such as education, housing, transportation and healthcare. These effects make credit relevant to both everyday financial decisions and longer-term plans.

Our research also shows that these consequences are especially pronounced for younger consumers, who report higher levels of worry and disruption tied to credit even as they recognize its importance in their financial lives.

Credit education should be part of how we think about financial inclusion. Access gives people more options but understanding how credit works helps them evaluate those options and manage credit responsibly. Clear information about what influences a credit score, how payment history and credit use shape credit health and where to find trustworthy resources can help people make informed decisions and build stronger financial habits over time.

How Synchrony Expands Access and Understanding

At Synchrony, we are improving how we assess creditworthiness by looking beyond what a credit score alone can tell us. Alternative data, including cash-flow information, can provide a fuller view of someone’s financial situation and help us responsibly identify creditworthy consumers whom traditional approaches may overlook.

Through our participation in Project REACh, an initiative led by the Office of the Comptroller of the Currency, we used alternative data and cashflow underwriting to extend credit to more than 80,000 people without conventional credit scores. More than half reached a prime credit score a year later. Those results show that alternative views of creditworthiness can help people without a conventional credit score successfully enter and build standing in the mainstream credit system.

That same commitment to understanding led us to launch Your Next Yes, a free educational resource from Synchrony for people who are new to or rebuilding their credit. The resource explains credit fundamentals, outlines steps consumers can take to build credit and directs them to information they can use when making financial decisions. Learning what affects a credit score, reviewing credit information regularly and using trusted resources can help people understand how their choices affect both their credit health and the options available to them.

Get Smart About Credit Day is an important reminder that credit education is one of the important ways we can help solve the financial access challenge. When people understand how credit works and have a fair opportunity to demonstrate their creditworthiness, they have more power to make informed choices, build financial stability and pursue what matters in their lives.

Frequently Asked Questions

Q: What is the connection between credit education and financial education?
A: Credit education can help people understand their financial options and manage credit responsibly. Financial inclusion should account for both access to credit and understanding of how credit works, including what influences a credit score, how payment history and credit use affect credit health and where consumers can find trustworthy information.

Q: How can alternative data and cash-flow underwriting expand access to credit?
A: Using alternative data, including cash-flow information, in underwriting decisions can help provide a fuller view of a consumer’s financial situation beyond a conventional credit score. Synchrony believes this approach can help responsibly identify creditworthy consumers that may be overlooked by traditional approaches. Through Project REACh, Synchrony has used alternative data and cashflow underwriting and to extend credit to more than 80,000 people without conventional credit scores, and more than half have reached a prime credit score within a year.

Q: Why does understanding my credit score matter for my financial health?
A: Understanding your credit score can help you see how your financial choices affect your credit health and the options available to you. Synchrony research found that 86% of consumers said credit scores are important, yet only 35% felt confident explaining how credit scores are calculated.

Q: How is Synchrony supporting credit education and credit access?
A: Synchrony supports credit education and access through several efforts: Your Next Yes provides free credit education for people who are new to or rebuilding credit. Empowering Financial Futures provides educators with training, classroom resources and Financial Literacy Labs for K-12 students learning about credit and financial literacy. Synchrony also uses alternative data and cashflow underwriting to look beyond a traditional credit score to expand access to credit responsibly to more Americans.

Q: What is Get Smart About Credit Day and why does it matter?
A:  Get Smart About Credit Day is an annual American Bankers Association Foundation campaign that helps people build financial knowledge.

Q: What is Synchrony’s Your Next Yes?
A: Your Next Yes is a free educational resource from Synchrony for people who are new to or rebuilding their credit. It explains credit fundamentals, outlines steps consumers can take to build credit and directs people to information they can use when making financial decisions.