According to TransUnion data, first-time credit users, or NTC consumers, are just as risky as those with established credit histories — if not a little better.

A global study titled “Empowering Credit Inclusion: A Deeper Perspective on New-to-Credit Consumers” provides lenders in both established and developing credit markets with reassuring hard data that allows them to offer additional credit products without causing a corresponding increase in delinquency rates.

The study focused on subjects who, when they opened their first credit line, had no prior credit history with the bureau and evaluated their behaviors and performance for two years following opening their first line of credit. It covered not only the U.S., but Brazil, Canada, Colombia, Dominican Republic, Hong Kong, India, Philippines, and South Africa as well.

It is estimated that 5.8 million American consumers opened their first line of credit in 2021, with 59% of them from the Gen Z generation, 21% from the Millennial generation, 12% from the Gen X, and 7% from the Baby Boomers. Comparing these consumers to counterparts with established files, the study found that they were generally good risks.

Additionally, not only in the U.S. but also in other countries, credit cards were the most common form of credit line taken out by NTC consumers as found in the study.

Moreover, the study found that opening a line of credit was primarily motivated by unforeseen expenses. Almost all consumers, with the exception of those in India, found a credit product at the first institution to which they applied – without having to go to more than one lender. 54% of NTC borrowers in the U.S. reported receiving credit lines from the first institution where they applied for a credit product.