FNBO and FICO Expand Credit Transparency Program to Empower Consumers
Nearly Half a Million Consumers Now Receive Free Access to FICO® Scores Through FNBO’s Credit Watch℠ Program
FNBO’s Credit Watch: Providing Financial Insights and Transparency
For more than ten years, FNBO (First National Bank of Omaha), one of the largest privately held banks in the United States, has worked with analytic software leader FICO to provide FICO® Scores to its customers by participating in the FICO® Score Open Access program. This access creates and cultivates more financially aware, literate consumers by allowing them to receive their FICO Score directly on their online account or mobile app. Expanding on its success with FICO Score Open Access, FNBO introduced an enhanced and feature-rich consumer education program known as FNBO Credit Watch℠.
Through the FNBO Credit Watch℠ program, FNBO customers can receive their FICO® Score and view up to five positive and negative reporting factors that impact their FICO Score. These additional factors help educate customers and provide them the tools to make more informed credit decisions. Using this reporting, customers further understand the impacts of opening new lines of credit, paying down debt and paying bills on time. Since the launch of FNBO Credit Watch in June 2023, nearly 500,000 customers have joined the program in the first nine months. This accounts for 17% of FNBO’s online consumer credit card population who now have the tools for more financial transparency on their credit journey.
“The benefits the FICO Score Open Access and FNBO Credit Watch programs provide have been tremendous,” said Jerry O’Flanagan, executive vice president at FNBO. “The transparency has enabled our customers to be more in control of their everyday finances. This knowledge and empowerment transfers to other significant customer financial decisions, whether it is obtaining a home mortgage, starting a small business, or buying a car.”
You can read more about this story in the full media release.
FNBO’s Credit Watch: Provides Real-Time Credit Alerts and Financial Reporting
With FNBO’s Credit Watch℠, real time credit inquiry alerts also help customers monitor their accounts by supporting early detection of identity theft and fraud. These reporting features support the company’s ongoing focus to encourage financial well-being and deepen relationships with customers.
"Over the past year, we've been focusing on what else we can bring to our customers, and we've done that by launching the FNBO credit watch tool," said Nicole Wojtalewic, vice president at FNBO. "This tool not only gives them their FICO score, but it gives so much more information that they can get right at their fingertips. It'll include their history, FICO score, ingredients, even education. By giving financial responsibility to our card holders and empowering them to do better, it allows us to even build more financially responsible customers long term."
FNBO's efforts in furthering credit transparency align with FICO's focus on financial literacy and empowerment. It is important for consumers to have access to their FICO Score, the credit score used by 90% of top U.S. lenders.
For these achievements, FNBO won a 2024 FICO® Decisions Award for Financial Inclusion.
“FNBO’s Credit Watch program is an impactful project that can help more Americans gain control of their financial health,” Nick Vitchev, director at Chartis Research and one of the FICO Decisions Awards judges. “The judges were impressed by FNBO’s commitment to expanding their financial education and credit transparency toolset to better serve their customers.”
To see the full list of this year’s FICO® Decision Awards winners, check out: https://www.fico.com/en/fico-decisions-awards-2024
With the enhanced content of the FICO Score consumer educational program, lenders like FNBO, are able to provide their customers with content beyond the standard program, such as additional FICO Score Factors and FICO Score Ingredients that provide a deeper insight and transparency into what is driving the consumers FICO Score.
How FICO Can Help You Educate Consumers About Credit
- Learn about how you can strengthen customer relationships and increase profitability with the FICO® Score Open Access program. FICO Score Open Access empowers you to report and share FICO® Scores you already use for account risk management decisions with your customers – with no additional score fees charged by FICO.
- Do you want to know how to more precisely predict a borrower’s resilience to future economic disruptions? Then your customer reporting should include insights from the FICO® Resilience Index.
- Watch this video content about CredEvolv and how they are using FICO® Score Open Access to give nonprofit housing counselors the tools and reporting they need to improve financial literacy for consumers.
- Watch this webinar content on "Emerging Credit Risk Trends & Growth Through Credit Score Transparency" to learn about FICO’s latest financial benchmarking reports that include important consumer resilience insights and trends.
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FICO® Score High Achievers: Is Age the Only Factor?
<p>FICO’s latest research on <a href="http://www.fico.com/en/blogs/risk-compliance/us-credit-quality-rising-the-beat-goes-on/" target="_blank">national FICO® Score distribution</a> 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 “<a href="http://www.fico.com/en/blogs/risk-compliance/infographic-what-does-a-high-credit-scorer-look-like/" target="_blank">FICO® Score high achievers</a>,” where we examine the credit behavioural profiles of consumers with higher credit scores.</p> <p>As expected, our latest study showed that older people generally have higher scores, as has been the case in our <a href="http://www.fico.com/en/blogs/risk-compliance/age-before-beauty-credit-worthiness-before-youth/" target="_blank">past research</a>. 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 <a href="http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx" target="_blank">FICO® Score calculation</a>.</p> <p>But for younger consumers, it isn’t too helpful to say, “just wait until you are 50 years old, and that will fix things!” Thus, I decided to dive deeper with our analysis, including looking at the credit behavioural characteristics of younger consumers with high FICO® Scores.</p> <p>In this analysis, I looked at credit characteristics for the two highest score bands, 750-799 and 800-850, which have about 16% and 23% of the population, respectively. I further broke this down by looking at the characteristics of the youngest 15% in each group, which occurs at age 29 for the 750-799 group and 43 for the 800-850. We used FICO<strong>®</strong> Score 9 for our analysis, and examined typical variables of the categories that go into the make-up of the score.</p> <p><a href="http://www.fico.com/en/blogs/wp-content/uploads/2016/10/FICO-Score-High-Achiever-table.png"><img class="alignnone size-full wp-image-29367" src="http://www.fico.com/en/blogs/wp-content/uploads/2016/10/FICO-Score-High-Achiever-table.png" alt="fico-score-high-achiever-table" width="715" height="747" /></a></p> <p>Since there’s a lot to dissect in this chart, I’ll highlight a few findings that struck me: <ul> <li><strong>Credit history.</strong> Higher scores are undoubtedly associated with a longer time on file. What’s striking is the higher average time on file for the 800+ group, both overall and for revolving accounts (the most common trade line). Clearly, it helps to start credit use early in life – but that’s not the sole determining factor for high scoring. The younger cohorts in both the 800+ and 750-799 groups have time on file medians significantly less than their older counterparts.</li> <li><strong>New credit.</strong> High credit scorers do, in fact, pursue new credit. We see little variation in months since last trade line opening and last inquiry among all groups observed.</li> <li><strong>Pay on time.</strong> As you might expect, the further in the past the delinquency, the higher the score – and that’s <u>if</u> a delinquency ever happened. 95% of the 800+ people and 72% of the 750-799 group have never been delinquent, which is a striking contrast to the 57% for the total population. The percentages for the younger groups are even higher, especially so for the 750-799ers. Collection items are also scarce for these high scorers. While 23% of the national population have collection items greater than $99, the figures are only 0.5% for the 800+ group and 3% for the 750-799 group. It is clear that, in conjunction with starting a credit file early, paying on time is a key trait of the FICO® Score high achiever.</li> <li><strong>Balance and utilization.</strong> Finally, we look at how credit is being used, focusing on revolving product use. (Since most people only have one mortgage or one auto loan, variation in instalment product figures is minimal and driven by payment history, which is near perfect for high scorers, as we’ve seen.) FICO® Score high achievers tend to have more open revolving accounts. While the % active trades and utilization are generally lower, by no means do high scorers avoid the use of credit products. What drives the difference here is the amount of <u>available</u> revolving credit utilized. The 800+ group is roughly 1/4 of the national median, both in total and on their highest utilized card; they also have lower balances and more cards<em>. </em>The 750-799 group is more active and higher utilized, but still only at 2/3 of the national figures. The young 750-799 group compensate with lower revolving balances and, as a result, lower utilization, which is in line with what we see for the 800+ group.</li> <li><strong>Benchmarks.</strong> I’d like to point out that while this study provides good benchmarks of the typical credit traits of the FICO® Score high achiever, individual credit profiles will vary widely. And keep in mind that when we sort groups of consumers as a whole by different behaviours, some results may look superficially odd. For example, the 800+ band has a longer median average open account time (128 months) than average revolving months on file (140 months).</li> </ul> So, what do we conclude? A huge takeaway is that high scorers don’t have too much in the way of serious delinquencies and negative public record data.</p> <p>In most respects, the young 800+ people are like their peer group. They really only differ markedly in their shorter credit history and higher non-mortgage balance, both of which are a function of life stage. Our results show that you don’t have to be a credit product hermit; these high scorers have more credit cards. The takeaway is to start credit activity early and maintain well-managed and moderate usage.</p> <p>In many ways, the young 750-799 people are more interesting because their age profile is much younger. Their credit characteristics differ more from their peer group, particularly in terms of length of credit history. They compensate by having almost pristine credit records and lower balances.</p> <p>Ultimately, 39% of US consumers are FICO® Score high achievers, which they accomplish by following common-sense credit practices. It ain’t rocket science!</p>
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