Driving Growth with New Measure of Capacity White Paper

For more than five years, growth initiatives have been extremely difficult for UK lenders. In a weak, uncertain economy, even a modest amount of additional debt can push many consumers-even those with favourable credit profiles-into default. Today, when evaluating consumers for new loans or extensions of credit, lenders must measure repayment risk, and they must take another measure into account: How much credit is too much?

That’s why FICO and Equifax are helping UK lenders jump start growth with the combination of solid risk assessment of a consumer’s historical and current obligations—via Equifax’s Risk Navigator score—and a consumer’s capacity to manage additional obligations—via the new FICO^® CreditCapacity Index™. The new index is a complementary risk measure that predicts capacity by inferring a consumer’s ability to manage incremental debt not yet represented on the credi