The thin (file) man

He doesn't fit the usual profile of a "thin-file" consumer, but Citigroup Inc. executive Robert A. Annibale has personal experience with the perils of a blank credit history.

"Thin-file" consumers tend to be immigrants or young people who have not yet built enough of a credit history to qualify for a loan. Some consider them to be part of the underbanked market -- those who lack traditional banking relationships.

We think it's safe to assume that Annibale, Citi's global director of microfinance, has a healthy relationship with the traditional banking system. But in a keynote address here at the fourth annual Underbanked Financial Services Forum in Dallas, he revealed his own history as a "thin-file" consumer.

Annibale, who works out of London, said he was trying to find an apartment in New York a few years ago. But his search hit a snag when he found that, thanks to being an "immigrant" from the United Kingdom with few U.S. loans of record, he had no U.S. credit history.

"I said, 'Isn't that good? There's nothing negative'" in the file, he recalled, drawing laughs from the audience.

In his professional capacity, Annibale is focused on helping thin-file consumers gain better access to credit. Last year, his unit signed a five-year deal to buy up to $30 million of small-business loans from the San Antonio nonprofit microlender Accion Texas. (In December, Janie Barrera, Accion's president and chief executive officer, received American Banker's 2008 Innovator Award for making microfinance work in the United States.)

On Wednesday, Annibale and Barrera participated in a panel discussion about "Successful U.S. Microfinance in Action." (The conference was presented by the Center for Financial Services Innovation, an affiliate of ShoreBank Corp. in Chicago, and SourceMedia Inc., the parent company of American Banker.)

Of course, most thin-file consumers are trying to secure loans to buy a car or to start a small business, not a Manhattan mortgage. But Annibale said in an interview after the presentation that his experience illustrates the need to gather better information about thin-file consumers.

"The elements that feed into your credit history just might not be getting captured, and I think that's very important for this segment. People have got a [credit] performance of kinds, but whoever that's with may not be reporting it, so they more likely look like a thin-file and that's why they have a lower credit score," he said. "It's not that they have any bad history that's causing them to have that score."

As for the fate of his apartment bid? The same principle applied: Annibale said that after he provided his asset information and the name of his employer, his application was finally approved.