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Credit Scorecards
A credit score is a numerical expression representing the creditworthiness of an individual. A credit score is primarily based on a credit report, information typically sourced from credit bureaus. Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt. Lenders use credit scores to determine who qualifies for a loan, at what interest rate, and what credit limits. Lenders also use credit scores to determine which customers are likely to bring in the most revenue. Credit scoring is not limited to banks. Other organizations, such as mobile phone companies, insurance companies, landlords, and government departments employ the same techniques. Digital finance companies such as online lenders also use alternative data sources to calculate the creditworthiness of borrowers. Characteristics of scorecards Scorecards are built and optimized to evaluate the credit file of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Creditworthiness
Credit risk is the chance that a borrower does not repay a loan or fulfill a loan obligation. For lenders the risk includes late or lost interest and principal sum, principal payment, leading to disrupted Cash flow, cash flows and increased Collection cost, collection costs. The loss may be complete or partial. In an Efficient-market hypothesis, efficient market, higher levels of credit risk will be associated with higher borrowing costs. Because of this, measures of borrowing costs such as yield spreads can be used to infer credit risk levels based on assessments by Market participant, market participants. Losses can arise in a number of circumstances, for example: * A consumer may fail to make a payment due on a mortgage loan, credit card, line of credit, or other loan. * A company is unable to repay asset-secured fixed or floating charge debt. * A business or consumer does not pay a trade credit, trade invoice when due. * A business does not pay an employee's earned wages whe ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Criticism Of Credit Scoring Systems In The United States
Credit scoring systems in the United States have garnered considerable criticism from various media outlets, consumer law organizations, government officials, debtors unions, and academics. Racial bias, discrimination against prospective employees,"Millions Need Not Apply" '''', May 29, 2011. discrimination against medical and student debt holders, poor predictability, manipulation of credit scoring |
CIBIL
TransUnion CIBIL Limited is a credit information company operating in India. It maintains credit files on 600 million individuals and 32 million businesses. TransUnion is one of four credit bureaus operating in India and is part of TransUnion, an American multinational group. Consumer credit reporting Trans Union CIBIL aggregates consumer borrowing and payment information for the purpose of assessing loan risk and pricing credit (setting the interest rate). It has partnered with Chicago-based TransUnion. Consumer credit scores are also used in unemployment decisions, although there are no studies in India showing that impaired credit leads to employee misconduct and unemployment. Business credit reporting TransUnion CIBIL aggregates business financial and payment information for the purpose of assessing loan risk and pricing credit (setting the interest rate. It has partnered with New Jersey–based Dun and Bradstreet. D&B maintains files on 150 million business worldwi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
TransUnion
TransUnion LLC is an American consumer credit reporting agency. TransUnion collects and aggregates information on over one billion individual consumers in over thirty countries including "200 million files profiling nearly every credit-active consumer in the United States". Its customers include over 65,000 businesses. Based in Chicago, Illinois, TransUnion's 2014 revenue was US$1.3 billion. It is the smallest of the three largest credit agencies, along with Experian and Equifax (known as the "Big Three"). TransUnion also markets credit reports and other credit and fraud-protection products directly to consumers. Like all credit reporting agencies, the company is required by U.S. law to provide consumers with one free credit report every year. Additionally a growing segment of TransUnion's business is its business offerings that use advanced big data, particularly its deep AI-TLOxp product. History TransUnion was originally formed in 1968 as a holding company for Union Tank ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Experian
Experian plc is a multinational corporation, multinational data broker and consumer credit reporting company headquartered in Dublin, Ireland. Experian collects and aggregates information on more than 1 billion people and businesses including 235 million individual U.S. consumers and more than 25 million U.S. businesses. It is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index. Experian is a partner in United States Postal Service, USPS address validation. It is one of the "Big Three" credit-reporting agencies, alongside TransUnion and Equifax. In addition to its credit services, Experian also sells decision analytic and marketing assistance to businesses, including individual fingerprinting and targeting. Its consumer services include online access to credit history and products meant to protect from fraud and identity theft. Like all credit reporting agencies, the company is required by U.S. law to provide consumers with one free credit report ever ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Equifax
Equifax Inc. is an American multinational consumer credit reporting agency headquartered in Atlanta, Atlanta, Georgia and is one of the three largest consumer credit reporting agency, consumer credit reporting agencies, along with Experian and TransUnion (together known as the "Big Three"). Equifax collects and aggregates information on more than 800 million individual consumers and more than 88 million businesses worldwide. In addition to credit and demographic data and services to business, Equifax sells credit monitoring and fraud prevention services directly to consumers. Equifax operates or has investments in 24 countries in the Americas, Europe, and Asia-Pacific, Asia Pacific. With more than 14,000 employees worldwide, Equifax has nearly US$5 billion in annual revenue and is traded on the New York Stock Exchange (New York Stock Exchange, NYSE) under the symbol EFX. History Equifax was founded as the Retail Credit Company by Cator and Guy Woolford in Atlanta, Atlanta, Geo ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Dun & Bradstreet
The Dun & Bradstreet Holdings, Inc. (D&B) is an American company that provides commercial data, analytics, and insights for businesses. Headquartered in Jacksonville, Florida, the company offers a wide range of products and services for risk and financial analysis, operations and supply, and sales and marketing professionals, as well as research and insights on global business issues. It serves customers in government and industries such as communications, technology, strategic financial services, and retail, telecommunications, and manufacturing markets. The company's database contains over 500 million business records worldwide. History 19th century Dun & Bradstreet traces its history to July 20, 1841, with formation of The Mercantile Agency in New York City by Lewis Tappan. Recognizing the need for a centralized Credit score, credit reporting system, Tappan formed the company to create a network of correspondents who would provide reliable, objective credit information t ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Credit Bureau
A credit bureau is a data collection agency that gathers account information from various creditors and provides that information to a consumer reporting agency in the United States, a credit reference agency in the United Kingdom, a credit reporting body in Australia, a credit information company (CIC) in India, a Special Accessing Entity in the Philippines, and also to private lenders. It is not the same as a credit rating agency. Description A consumer reporting agency is an organization providing information on individuals' borrowing and bill-paying habits. Such credit information institutions reduce the effect of asymmetric information between borrowers and lenders, and alleviate problems of adverse selection and moral hazard. For example, adequate credit information could facilitate lenders in screening and monitoring borrowers as well as avoiding giving loans to high risk individuals. Lenders use this to evaluate credit worthiness, the ability to pay back a loan, and can a ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Credit Risk
Credit risk is the chance that a borrower does not repay a loan In finance, a loan is the tender of money by one party to another with an agreement to pay it back. The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money. The document evidencing the deb ... or fulfill a loan obligation. For lenders the risk includes late or lost interest and principal payment, leading to disrupted cash flows and increased collection costs. The loss may be complete or partial. In an efficient market, higher levels of credit risk will be associated with higher borrowing costs. Because of this, measures of borrowing costs such as yield spreads can be used to infer credit risk levels based on assessments by market participants. Losses can arise in a number of circumstances, for example: * A consumer may fail to make a payment due on a mortgage loan, credit card, line of credit, or other loan. * A company is unable to repay asset- ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Consumer Credit Risk
:''The following article is based on UK market; other countries may differ.'' Consumer credit risk (also retail credit risk) is the risk of loss due to a consumer's failure or inability to repay ( default) on a consumer credit product, such as a mortgage, unsecured personal loan, credit card, overdraft etc. (the latter two options being forms of unsecured banking credit). Consumer credit risk management Most companies involved in lending to consumers have departments dedicated to the measurement, prediction and control of losses due to credit risk. This field is loosely referred to consumer/retail credit risk management, however, the word ''management'' is commonly dropped. Scorecards A common method for predicting credit risk is through the credit scorecard. The scorecard is a statistically based model for attributing a number (''score'') to a customer (or an account) which indicates the predicted probability that the customer will exhibit a certain behaviour. In calculating t ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Credit Score
A credit score is a numerical expression based on a level analysis of a person's credit files, to represent the creditworthiness of an individual. A credit score is primarily based on a credit report, information typically sourced from credit bureaus. Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt. Lenders use credit scores to determine who qualifies for a loan, at what interest rate, and what credit limits. Lenders also use credit scores to determine which customers are likely to bring in the most revenue. Credit scoring is not limited to banks. Other organizations, such as mobile phone companies, insurance companies, landlords, and government departments employ the same techniques. Digital finance companies such as online lenders also use alternative data sources to calculate the creditworthiness of borrowers. By country Australia In Australia, cr ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Credit Report
A credit history is a record of a borrower's responsible repayment of debts. A credit report is a record of the borrower's credit history from a number of sources, including banks, credit card companies, collection agencies, and governments. A borrower's credit score is the result of a mathematical algorithm applied to a credit report and other sources of information to predict future delinquency. In many countries, when a customer submits an application for credit from a bank, credit card company, or a store, their information is forwarded to a credit bureau. The credit bureau matches the name, address and other identifying information on the credit applicant with information retained by the bureau in its files. The gathered records are then used by lenders to determine an individual's credit worthiness; that is, determining an individual's ability and track record of repaying a debt. The willingness to repay a debt is indicated by how timely past payments have been made to other ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
