Risk & Compliance Gamification in the Auto Industry; Can it Drive Results?

Yu-kai Chou, is a gamification expert who spoke about gamification in Auto to attendees at the FICO Automastermind event

Guest Post: Today we have a guest post about gamification in auto from Yu-kai Chou, Founder and President of The Octalysis Group. He was a featured speaker at our Automotive Mastermind event held last month in Silicon Valley. The Octalysis Group is a gamification consultancy that assists companies to understand the core drivers that motivate people to take action and applies these to business objectives. === Driving Engagement in Experiences is a Necessity In The New World All around the world in many different industries from software to education, banking to automotive, businesses have been focused on making products that are more efficient and effective but not more engaging and interesting. To be successful in the new age of engagement, businesses need to be optimized for human motivation. Essentially, successful companies are realising the need to shift from ‘function-focused design’ to ‘human-focused design’. Human-focused design strives to answer the key question: “Why do... [Read More]

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Fraud & Security PSD2 – Why Customer Communications Are Key

PSD2 with question mark

As I discussed in a previous blog, consumers have not been extensively educated on the impact that PSD2 will have on them. Many of the outcomes of PSD2 will be positive – the Account Information Service Providers (AISPs) and Payment Initiation Service Providers (PISPs) will give people access to a range of new services that will help them to manage their money better and give them more flexibility in the payment providers they use. However, the fraud prevention measures that form an integral part of PSD2 will have a knock-on effect for consumers. In some instances, security checks will make initiating a payment more difficult and irritating. Sometimes the checks may even stop it. Poor Customer Management will Impact the Bottom Line We already know that introducing friction into customer transactions is viewed negatively. Many organisations consider losses to abandoned transactions as important or more important as losses to fraud. PSD2... [Read More]

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Risk & Compliance FICO Data: Have Premium Cards Lost Their Edge in the UK?

Gold card

Are Premium cards becoming harder to distinguish from Standard Classic cards? Is there still a place for them in the market? Traditionally, Premium* cards (gold and platinum) were perceived as reserved for the lowest-risk, best-quality accounts, and so had higher limits. Spend was thought to be greater, though a larger proportion of full-balance payers made them less profitable than Classic cards. However, over time the FICO Benchmark Reporting Service data for the UK reveals that the Premium customer is changing and so is the performance, particularly of the more mature accounts. In July 2017 25% of the accounts in the FICO Benchmark Reporting Service were Premium accounts, along with 25% of balances. With the exception of New accounts (<12 months on book), which were 20% of accounts and 20.4% of balances, Established (1-5 years on book) and Veteran (5+ years on book) accounts were about 25% of the relevant vintage population in the service. Common Beliefs... [Read More]

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Collections & Recovery Smart Government Agencies Turn to Next-Gen Customer Comms

Automated communications can increase the quality and quantity of customer engagement for government agencies

Government agencies are often challenged in their effort to optimize communications with their citizens. Most government executives want to increase the frequency and quality of their interactions, but tightening budgets have resulted in fewer interactions, not more. They’ve stopped sending annual booklets, they send fewer reminder notices and wait for consumers to call them rather than proactively reaching out. Reduced communication results in lower compliance and an increase in downstream problems. At the same time, more people than ever are using smart phones (SMS, email and web apps) and other electronic communication tools. Recent data from Deloitte tells us that 77 percent of Americans own a smartphone and its usage is so ingrained in our daily routine that 61 percent of Americans check their smartphone within five minutes of waking up. How long after you wake up do you check your smart phone? With this as a backdrop, it’s no... [Read More]

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Risk & Compliance NCAP Medical Collection Removals Are Rare and Have No Material Impact to FICO Scores


The National Consumer Assistance Plan (NCAP) is a comprehensive series of initiatives intended to evaluate the accuracy of credit reports, the process of dealing with credit information, and consumer transparency. In a previous post, we showed that July 2017 NCAP public record removals (civil judgments and some tax liens) had no material impact to FICO® Scores. In mid-September 2017, the three consumer reporting agencies (CRAs) are also scheduled to remove the following from credit reports: Medical collections less than 180 days old Medical collections that are ‘paid by insurance’ FICO recently conducted research on a representative sample of millions of US consumers to assess the impact of the NCAP-driven removal of these 3rd party medical collection agency accounts on the FICO® Score.  Our results showed that NCAP-related medical collection removals have no material impact on the aggregate population to the FICO® Score’s predictive performance, odds-to-score relationship, or score distribution. The removal of medical collections... [Read More]

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Analytics & Optimization My Top 10 Attributes of a Data Leader

Data graphic

A recent article in Information Age named 10 attributes of data leader. Each of the experts quoted discussed just one attribute — in my case, it was separating hype from potential, which is critical when you’re dealing with advanced analytics. Here’s an excerpt of what I wrote for that article: “In the Big Data era, businesses have been told to save every scrap of data because it might turn out to be a valuable clue to customer understanding or business performance. While the cost of storing data has fallen dramatically, it doesn’t represent the true cost of data, which includes ensuring quality, maintaining freshness and mitigating the risk of a breach. “Data leaders are equally discerning about the hype and potential of the analytics used on their data. They focus on the problems the business needs to solve, and investigate new analytic techniques that can make their data “talk” in... [Read More]

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Risk & Compliance The Right Auto Finance Offers Delivered in Seconds

Picture of articles on Auto Finance

The US automotive industry has shown immediate interest in FICO’s new auto finance loan origination solution. It was the big news drop at our Automotive Mastermind event held a few weeks ago in Silicon Valley and has been widely covered by industry media including Automotive News, Automotive Digest and SubPrime. FICO’s Alternative Deal Structures platform, designed specifically for automotive, works within lenders’ parameters and customers’ preferences to quickly produce multiple deal structure options at the point of sale from thousands of options in just seconds. Automotive News reported: “If you look at a typical auto finance scenario today, you might get a single deal structure offered by the underwriter [or] by the dealer, and the customer may or may not like it. If they don’t like it or something unusual comes up, they have to go through the whole rehash process,” Ken Kertz, senior director of FICO’s auto practice, told Automotive News.... [Read More]

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