No, this is not obvious at all. Given a fixed risk tolerance (or risk/payoff curve), you can only do certain amount of lending, so either you lend to the best prospects ("fairly", in some abstract sense), or you lend less efficiently and give less overall social benefit (but direct the social benefit to some particular subgroup). Having a bunch of different ways of assessing credit just ends up as a time tax that forces people on the margin to apply a bunch of different times, which ultimately benefits no-one.
Where I live there's a single standard formula that every lender uses, which seems a lot more efficient.
Any other solution will just result in inflation or some other problem. If the root cause is not addresses, then the problem will persist (as reality shows).
In other words, if the formula isn't perfect, it isn't good to apply it strictly. Some randomization of the low end threshold / lottery for the losers seems to be a good idea.
I think you will find that many community banks and credit unions still use the same ~2 vendors for id verification checks and credit history. That said, you are much more likely to be able to negotiate around an adverse finding at a smaller institution.
The other 9,900 community banks and credit unions largely continue to operate with vanilla retail and/or business banking models. I'm biased, but the importance of these financial institutions cannot be understated to the success of the American economy. Obviously a homogenous credit underwriting and decisioning process is a negative for society. While some do heavily rely upon the traditional credit bureaus in their decisioning, many do not. Access to responsible credit is one of the best ways to lift a group of individuals and/or businesses up. There is no surprise then that these organizations receive bi-partisan support.
As @patio11 points out this long tail often best serves their communities. There are a lot of reasons, but these are not purely because they happen to serve a specific geographic area or because they use different underwriting methods. Credit unions especially tend to be extremely diverse. For example, the majority of credit union CEOs are women[0].
I highly recommend supporting these community banks and credit unions by moving your loans and deposits to them. If you need a recommendation for one that has better digital experiences, please feel free to reach out to me.
[0] https://news.cuna.org/articles/119415-cuna-study-finds-51-of...