Student loan debt in the United States has reached an all-time high. Student loan debt can also be a part of a consumer’s financial journey as they look at buying a car, a house and even into retirement. With April being Financial Literacy month, FICO is exploring the credit behavior of young people with a student loan actively in repayment to determine the behaviors that are driving FICO® Score increases and decreases.  How many are exhibiting positive behaviors and driving score increases?  How many are exhibiting less favorable behaviors, leading to score decreases? Using a nationally representative sample, we identified 10 million scorable consumers age 18 to 30 who had a student loan actively in repayment as of October 2016. Among those within this profile, we found 22% had a significant increase in their FICO® Score 9 between October 2016 and October 2017.  We defined a “significant increase” as those with... [Read More]

FICO WORLD 2018, MIAMI, Florida FICO today unveiled a host of new retail banking solutions that allow lenders to manage the credit lifecycle in a way that is smarter, faster and simpler. The innovations are designed to help support lenders with their digital transformations as retail banking continues to be shaped by the forces of mobile, cloud, analytics and big data. “We have seen remarkable changes in banking in the last two years as lenders accelerate their digital transformation and reinvent the customer experience,” said Tim VanTassel, vice president of FICO’s credit lifecycle business line. “Lenders are engaged in an analytic arms race to find, delight and retain the right customers by determining and deploying differentiated offers and experiences.” Read the full media release here Originate Loans Using Optimized Deal Structures Providing consumers with multiple options for the best-fitting terms in real time has been an industry goal for some time, and... [Read More]

AI in Collections an Inevitability Artificial intelligence (AI) is becoming more integral in improving collections, according to banks in Asia Pacific (APAC). In a survey conducted at the FutureCollect event in March, seven out of ten senior collections managers revealed they plan to implement and integrate AI into their collections systems within the next two years, and 24 percent said they will do it next year. These new findings are consistent with FICO’s insights on AI earlier this year, predicting companies will focus on operationalizing AI in 2018. Almost half (48 percent) of banks believe that the use of AI will help them optimize their collection decisions, while 41 percent feel it will enable them to accurately predict consumer behavior. AI-powered analytics can improve automation in collections in many areas, from optimizing contact strategy settings to ensuring human agents make sophisticated decisions when restructuring debts or even calculating provision rates at an account level for IFRS 9... [Read More]

Today we have released the findings from our first ever global consumer survey on automotive finance perceptions. FICO’s independent research surveyed 2,200 adult consumers across nine countries including the US, Canada, Mexico, Chile, Australia, New Zealand, Germany, Spain, and the UK. The respondents were between the ages of 18-64 who acquired a loan on a new/used vehicle within the last 3 years. The findings cover the financing aspect of both new and used vehicles from the beginning of the journey where customers start to research, the middle where negotiation, ‘shopping around’ and the loan origination begins, and the end where the deal is formalized and the consumer walks away with their vehicle. 5 Surprising Findings in Automotive Finance (1) Americans love speed, right? The country that invented McDonalds should have the shortest wait times for auto finance. Wrong. It turns that the US is ahead of only Mexico in terms... [Read More]

UK cards on books 1-5 years are showing signs of debt stress - here are the facts, as well as recommendations for issuers.