Analytics & Optimization 4 Analytic Predictions for 2017 – From Killer Devices to AI Hype

Hand holding analytics
Nov302016

In many ways I think 2016 was the year that analytics hit the mainstream. At cocktail parties and in coffee shops, 2016 has been the year that we data scientists suddenly felt a bit like – dare I say it? – rock stars. A quick Google search provides a fascinating data point: “analytics 2015” returned 28.6 million hits “analytics 2016” returned 52.3 million hits Suffice it to say that in 2017, I believe that analytics, and the many domains it influences, will be a non-stop hit machine in terms of generating news headlines and ideas that fascinate us. Here are my predictions: 1. Security/IoT: Is your video cam no longer your friend?  In light of the recent Dyn attack, will 2017 be the year that your IoT device will turn on you? (Think Westworld, Humans, Terminator.) I think the answer is “yes.” In my recent blog, “Real talk: The imminent and... [Read More]

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Customer Engagement Video: TBC Bank Deploys Customer-Centric Originations

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Nov232016

Ever wonder how TBC Bank cut credit decision times from one day to fifteen minutes? In the video below, Giorgi Alibegashivili, strategy project manager at TBC Bank, talks about growing competition and the need to respond quickly to market changes, noting: “In today’s digital world, it’s important to be agile.” He explains why the bank turned to FICO® Origination Manager, which supports connected decisions across the entire lending lifecycle for a more holistic view of the customer. In a matter of months after implementation, TBC Bank significantly sped up time to decision, increasing customer satisfaction and driving competitive advantage. For more information, read the TBC Bank case study. And read our blog series on best practices in originations: What Does Best-in-Class Credit Originations Look Like? Are Your Credit Originations Good, Better or Best? Originations Software: Investing for Good Times and Bad

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Risk & Compliance Truth Squad: Will Looser Scoring Standards Help Millions More Americans Get Mortgages?

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Nov152016

Access to credit and the path to homeownership are important parts of the American way of life. That’s why it’s critical to understand what can be done to improve financial inclusion — and what won’t work. For months now, the three main US consumer reporting agencies – through their VantageScore business – have been claiming that millions of credit-starved Americans can get access to mortgages through the “innovation” of simply eliminating long-standing and essential minimum credit scoring criteria. This isn’t innovation, and it won’t help borrowers.  It’s time to set the record straight. Claim: By loosening the minimum scoring criteria, VantageScore can give millions of currently unscoreable Americans a credit score, making them mortgage-ready. Truth: Scoring sparse and old data may give more Americans a score, but it won’t help those Americans who are actually seeking homeownership credit.  Even worse, it locks millions of Americans into unfairly low scores. To... [Read More]

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Customer Engagement Video: Nationwide Building Society Deploys Unified Customer-Centric Risk Platform

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Nov102016

With 15 million members and more than £190 billion in assets, the UK’s Nationwide Building Society is the largest building society in the world. Due to its growth, Nationwide’s platform for evaluating and processing loan applications struggled to keep pace with changing market conditions, regulations and volume. Nationwide wanted to incorporate multi-bureau data into a single strategic risk infrastructure using advanced decision management technology. In this video, Andrew Jackson, Head of Credit Risk Measurement at Nationwide, explains how the company built a single risk platform to solve the problem and deliver superior customer experience. “We can be quicker to market with making changes. It used to take a number of weeks to make a pricing change for a personal loan product. We can now do that within a number of hours.” In addition, the approach has already added millions of pounds of revenue and savings. For more information, read the... [Read More]

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Fraud & Security Four Tips to Protect Your Phone From Hackers

Hacker message with ban symbol
Nov082016

Wash your hands. Brush (and floss) your teeth. Don’t reply to emails from Nigerian princes asking you to accept a wire transfer. These are just a few of the lessons we learn as kids, and adults, to develop good hygiene: “conditions or practices conducive to maintaining health and preventing disease, especially through cleanliness.” When I read about people infecting their Android phones with Gugi––a Trojan malware that steals user credentials when consumers log into mobile banking apps––by clicking on a link in a random text message, it’s clear to me that mobile phone users are in need of some security hygiene lessons. Here are four ways to keep your mobile phone safe from malware and hackers: 1.   The most basic: Don’t click on clickbait links in marketing text messages from senders you don’t know––even if the message promises you something really great, like a free cruise, an 80-quid coupon or a... [Read More]

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Fraud & Security It’s Time to Get Real About IoT Security

Fraud locks
Nov042016

The last few years have seen a surge in everyday devices coming online: coffeemakers, refrigerators and beer kegs, to name a very few, each with their very own IP addresses. And those are just within your kitchen. Collectively called the Internet of Things (IoT), these devices are indeed game-changers. But it’s no wonder Gartner informs us that in its Hype Cycle for Emerging Technologies, 2016, IoT is currently at the peak of inflated expectations. Manufacturers are more than happy to fulfill consumer demands to connect everything to the Internet. Mirai strikes, once, twice, thrice As it always happens, however, in the rush to win customers, ease of use or time to market trumps safety and security. This was abundantly clear on October 21, when US and European internet traffic was significantly disrupted by a Distributed Denial of Service (DDoS) attack on Domain Name System provider Dyn. This attack impacted at... [Read More]

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Risk & Compliance FICO® Score High Achievers: Is Age the Only Factor?

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Nov032016

FICO’s latest research on national FICO® Score distribution shows that US credit quality continues to trend upwards, with an increasing number of consumers scoring in the highest scores ranges. Given that, we decided it was time to refresh our study on “FICO® Score high achievers,” where we examine the credit behavioural profiles of consumers with higher credit scores. As expected, our latest study showed that older people generally have higher scores, as has been the case in our past research. This is largely because they have trade lines that have been open longer, which leads to higher scores (assuming the trade lines are in good standing and all other things equal). The most credit savvy among you will remember that length of credit history accounts for roughly 15% of the overall FICO® Score calculation. But for younger consumers, it isn’t too helpful to say, “just wait until you are 50... [Read More]

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Risk & Compliance New York Proposes Major Changes to Cybersecurity Regulation

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Nov012016

These days, cybersecurity is a hot-button issue in policy circles. Look no further than the US presidential debates, where our two candidates have highlighted the need to address hackers, security breaches and even foreign nations that may be using sophisticated cyber tactics to influence the outcome of the upcoming November elections. The pressure to get policies and systems in place to confront these threats is real. Some policy leaders, like those in New York, are not deferring to the federal government to take the lead. On September 13, the New York Department of Financial Services (NYDFS) proposed first-of-its-kind cybersecurity rules covering a wide range of banks, insurers and financial services companies under its jurisdiction. The issuance of the proposed regulations follows a series of industry surveys and discussions with its regulated entities over the course of several years that provided insights on their cybersecurity programs, related costs and future plans.... [Read More]

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Analytics & Optimization MBA Candidates Get an Analytical Head Start from FICO

Sue Hubbard
Oct312016

This post comes from Sue Hubbard, the adjunct professor for the FICO Academic Engagement Program. Professors that I’ve spoken with all agree that the theoretical concepts they cover in their lectures become solidified for students when they get a chance to apply those concepts to a real-world situation. It’s the transition from theoretical to practical that brings excitement to the course. However, those who are teaching predictive analytics often lack the resources to have their students apply the methodologies that they cover in class to real-life business problems. It requires combining a business scenario with a large-scale data set, acquiring the appropriate tools for data analysis, and providing domain expertise necessary to interpret the results. In aggregate, the necessary preparation would quickly exceed the time constraints of professors who are, rightfully so, spending their time teaching students. At its highest level, predictive analytics can be summarized as using historical information to predict the... [Read More]

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Analytics & Optimization Are Banks Embracing Public Cloud?

analytics in cloud
Oct282016

Banking is one of the most regulated industries in the world, often saddled with antiquated regulations that are not keeping up with the digital world. Many believe these regulations have kept banks away from the benefits of cloud computing, in particular services hosted on a public cloud. But that is changing. In recent years, FICO has been democratising analytics and enabling organisations of all sizes to harness the power of analytics-based decisioning.  This process is driven by cloud computing. The opportunity for enterprises to leverage cloud based analytics is especially compelling in the area of real-time and near-real-time communications.  Consumers demand multi-channel communications that are effective, mobile and in line with their individual needs and preferences. Are banks ready to undergo the digital transformation of their business model in order to respond effectively to those needs whilst maintaining regulatory compliance?  In short, yes – responding to customer needs has always been essential... [Read More]

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