By: Kari Michel
Credit bureau data has been used for many years to develop credit risk models, bankruptcy scores, profitability models, and response models to name a few. For the utility industry (water and power companies), a new score is available to help them administer more efficiently their internal low-income assistance programs. One challenge that utility companies face is to identify those consumers who clearly qualify for low-income assistance in a more automated process in order to reduce the number of applications that require manual intervention.
Utility companies are starting to use scoring models to help them determine the likelihood that a customer will qualify for low-income assistance from their local utility. In a recent Experian case study, a medium-sized municipal utility company in California conducted a test using Experian’s Financial Assistance Checker to understand the benefit of using this score in their recertification process. The test showed a reduction of manual review of about 40% of the test file and they expect a 40-50% reduction in manual review in the future. The inclusion of the score in the recertification process will reduce costs and make their low income assistance program more efficient and provide an excellent example of the utility’s efforts to make a positive impact on the community.
