As anyone following the economic situation in the UK knows, these are trying times for banks and consumers alike. The Bank of England just released another disappointing growth report, and revised its projection down to 2.7 percent in 2011, and 2.8 percent in 2012. Overall productivity has eroded due in large part to the fact that the high-productivity banking sector was hit so hard by the credit crunch. Banks are feeling the pinch of new capital requirements — in a recent survey by FICO and the European Financial Marketing Association (Efma), 62% of UK credit risk managers said new banking regulations will reduce profits from consumer and SME credit portfolios. And if that weren’t enough, a new round of European stress tests looms in June.
That’s why the new partnership between FICO and Equifax announced last week makes so much sense. Our clients in the UK have told both companies point-blank they need more innovative solutions to help them grow while controlling risk. And those growth plans are needed, more than ever, to shore up a flat economy.
This partnership will allow both companies to take a fresh look at each other’s assets – data, software, analytics, consulting practices – and bring new ideas to the table. We’re already discussing solutions that would cross the entire customer lifecycle, and help our clients not only control risk better but find pockets of customer opportunity for new offers to stimulate growth. It’s early days, but this partnership has all the promise of the last month’s other major UK link-up — the one you probably watched on TV.