Aug
22
2011

Does one size really fit all?

One of the challenges in developing credit scores for more than 25 million businesses in the U.S. is accounting for the differences. After all, statistical scoring started in order to avoid making time consuming decisions on each new account application. On the other hand, having one scoring model would lump every company together in one model, from Apple and Exxon to Bob’s Barbershop.

The solution? Segmentation. While it would be impossible to have more than 25 million separate models, it is possible to group businesses by like characteristics. For example, the Intelliscore Plus model has a large company segment. Companies with over 1,000 employees are scored by a separate model specifically crafted for larger companies. As such, this model does not heavily weight the number of liens or judgments since this factor is so common with larger companies.

To learn more about Intelliscore Plus and segmentation, click here: http://www.experian.com/intelliscoreplus/