New FICO Credit Scores Provide Lenders Opportunity to Expand Access to Credit in India
Chennai, India — October 25, 2017 • According to The World Bank, nearly350 million adults in India have no access to mainstream lending opportunities due to insufficient data. • FICO® Score for India,which usesdata from anyof the major credit bureaus, brings proven technology in assessing Indian consumers with traditional credit data. • FICO® Score X Data India, in partnership with LenddoTM, uses digital data from various sources provided with the explicit consent of the consumer so lenders can responsibly extend credit to previously unscorable consumers. • New score innovation in India highlights momentum of the FICO Financial Inclusion Initiative; FICO is currently engaged in similar efforts in the U.S., Mexico, Russia, China,Philippines, and additional countries around the world.
Analytics softwarefirm FICO today announced the launch of the FICO® Score in India and theroll-out of an alternative data score,FICO® Score X Data India, in partnershipwithLenddoTM. Accordingto theWorld Bank,nearly half of India’s adult population are unbanked orunderbanked. These new scores, FICO Score and FICO Score X Data for India, willgive lenders greater flexibility and precision in their risk assessment ofconsumers,as well as helpthem safely and responsibly extend credit to millionsmore people.
FICO® Score forIndia is based on traditional credit data available from any of the majorcredit bureaus in India.FICO® Score X DataIndia,in partnership with LenddoTM,evaluates alternativedata such as that from a consumer’s digital footprint (web or mobile device)toproduce a score for consumers who don’t have enough traditional data on filewith one of the Indian credit bureaus to produce a FICO® Score for India.
In the U.S., FICOhas been successful using alternative data including telco, property and publicrecord data to create FICO® Score XD. FICO®Score XD provides an onramp to credit access for over 50 million Americans whowere identified as ‘unscorable’.
“FICO is committedto bringing safe and sound credit scoring methods toIndia. Also,promoting global financial inclusion and creating atangible path to mainstream finance,” said Sally Taylor-Shoff, Scores vicepresident, FICO.“The two new scores we’ve launched in India will providetrusted options for lenders to tap into data from any credit bureau, as well asalternative data sources,to safely and responsibly evaluate millions moreconsumers who were previously unscorable.”
Richard Eldridge,co-founder and chief executive at Lenddo,said, “We believe that helping qualified low- and middle-income consumers gainaccess to credit will improve their lives and quite possibly transform Indiansociety. Defeating the need of a credit history to obtain a loan is essentialto bring unserved but qualified consumers into the formal economy and givingthem access to mainstream financial institutions. Our partnership with FICO isan excellent match with our expertise and we are keen to work with them toaugment the drive for financial inclusion in the world’s fastest growingeconomy.”
“The introduction ofthese scores is timely given the government’s recent efforts,” said DattuKompella, managing director in Asiafor FICO. “India’s Ministry of Financerecognizes that lack of financial inclusion forces the unbanked into informalbanking sectors where interest rates are higher and the amount of availablefunds much smaller. The Modi government last year launched a nationwidefinancial inclusion program that has now led to the opening of about 300million new bank accounts. FICO’s new score will allow Indian banks to expandtheir lending, which is good both socially and economically.”
The FICO Financial InclusionInitiative is a combination of products, platforms, services and partnerships that leverage emerging technology,innovative analytics and new alternative data sources to address the uniqueneeds and regulatory environment in each country to expand financial inclusionglobally. In addition to India, FICO is currently engaged in similarefforts in Mexico, Russia, China, and the Philippines.