In credit scoring, context makes all the difference.
Go beyond traditional credit info for greater insight.
The “safe” route for lenders is to focus only on prime applicants based on traditional credit scores. But, your competitors are all going after that same pool. Instead, you need to better differentiate and segment these full-file consumers for more compelling offers. You also need to look at a bigger pool that’s largely ignored: Creditworthy applicants who are below the magic score, or unscorable, yet exhibit “prime” financial behaviors.
One-fifth of the U.S. population is unbanked or underbanked[1], and 24% of this group is unscorable[2]. Many of these consumers are likely to be as creditworthy as those full-file, prime applicants. In fact, our own analysis showed that, when applying enhanced criteria, 51% have a similar default rate to highly coveted prime consumers.
[1] FDIC National Survey of Unbanked and Underbanked Households, 2013
[2] LexisNexis Risk Solutions research, 2013
LexisNexis® Risk Solutions has a number of compliance-friendly attributes and scores to help you assess a customer’s propensity to pay. With our breadth and depth of data resources, you’ll have the clear insight you need to:
Optimize product terms
Improve customer risk management
Expand the addressable market
Build loyalty & affinity with emerging consumers
Support financial inclusion
Alternative Data Can Predict Credit Risk
It’s Time to Redefine Prime
We believe in the power of data and analytics
to manage risk & uncover opportunity.
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