Tag: payment behavior

Authorized Push Payment fraud, also known as APP fraud or APP scams, involves a fraudster persuading a victim to willingly deposit funds to their account or to the account of a complicit third party, also known as a money mule. This type of fraud often includes social engineering of the victim using fake investment schemes, impersonation scams, purchase scams or other schemes. Social engineering clouds victims' judgments and encourages them to make payments willingly to one or more money mules, with funds eventually reaching fraudsters' accounts. This type of fraud has become more attractive to criminals since the advent of real-time payment systems, which are now a reality worldwide. Fraud fueled by real-time payments Authorized push payment fraud is becoming more prevalent, and it is imperative that you know how to detect and prevent it to safeguard your organization. Real-time payment systems, such as Faster Payments in the United Kingdom (UK), PIX in Brazil, the New Payments Platform in Australia, and FedNow in the USA, make real-time payment fraud a reality.  APP fraud is notoriously difficult for banks to prevent because the victim is sending the money themselves, and steps that banks take to authenticate customers are ineffective, as the customer will pass identity checks. The victims cannot reverse a payment once they realize they have been conned, as payments made using real-time payment schemes are irrevocable. APP fraud is particularly prevalent in countries where banks have an infrastructure that facilitates fast or immediate transfers, like the UK. Learn more about the new UK legislation around APP fraud Reimbursment is vital to victims Some common types of authorized push payment fraud include attacks on individuals like romance scams, family emergency swindles, targeting property transactions, and intercepting supplier payments. To protect against APP fraud, it is important to employ layered fraud protection across all products and channels used to manage real-time payments. But that alone is not enough. Reimbursement is vital in reversing the financial distress caused by APP scams, but it cannot reverse the emotional distress these scams cause. Prevention, detection, and awareness measures must be moved up on the agenda for banks, non-traditional lenders, PSPs (Payment Service Providers), and customers alike to ensure that the customer is protected at every stage of the payment journey.  Effective alerts are a key focus area for preventing customers from falling victim to APP scams. An effective warning is one that is dynamic and tailored to the customer’s payment journey. Recent research indicates that minor changes to notifications across banking apps can have the potential to drastically reduce the number of individuals that fall victim to APP fraud. The biggest effects were achieved when a combination of risk-based and Call to Action (CTA) warnings were implemented over a period of time. A collective effort across the banking industry and beyond is crucial to protect customers and tackle the fight against APP fraud. Banks, non-traditional lenders, and PSPs can raise awareness to educate their customers on the signs and risks of APP scams, and work with industry oversight bodies to commit to voluntary standards and codes to ensure good customer outcomes. Online forums, social media platforms, and influential voices also have a role to play in raising awareness of and preventing scams. Customers can also help by being vigilant and reading and acting upon warnings and information presented to them.  Authorized push payment fraud prevention To effectively combat authorized push payment fraud, financial institutions must implement a range of measures, including:  Direct communication with consumers.  Enhanced transaction monitoring.  Effective risk mitigation and management.  Improved employee education.  Public awareness campaigns.   In response to this growing threat, banks have introduced various checks and balances, such as the Confirmation of Payee (CoP) service in the UK, which cross-references bank details with the account holder's name when processing online payments.  Banks are also leveraging sophisticated fraud prevention software stacks, incorporating machine learning and contextual data to identify and flag suspicious transactions. By utilizing AI technologies, financial institutions can process  data points faster and enhance their fraud detection capabilities, mitigating identity risk and safeguarding customer accounts. Clear communication with customers is essential in the fight against APP fraud. Higher-risk companies now include warnings in their communications, advising customers not to act on messages that request payment into new bank accounts.  Financial institutions can also offer cool-off periods before payments are sent, increase due diligence around payment destinations, and monitor accounts that regularly receive high-value payments. Additionally, financial institutions can play a crucial role in educating their customers and promoting awareness around this increasingly common type of fraud. By combining these approaches with robust fraud prevention software, the public can fight against this type of fraudulent attack.  Taking the next steps with the right partner At Experian, we offer rich data sources, advanced analytics capabilities, and the consultancy services needed to rapidly adopt data analytics solutions that mitigate fraud risks. Our solutions are used by PSPs of all types and sizes – including some of the largest banks – to identify potentially fraudulent customers and transactions, and to ensure that action is taken in real time to prevent fraudulent payments being made.  Learn more about our fraud management solutions *This article leverages/includes content created by an AI language model and is intended to provide general information.

BNPL is a misunderstood form of credit. In fact, many consumers are unaware that it is credit at all and view it simply as a mode of payment. This guide debunks common BNPL myths to explain what BNPL data will mean for lenders and consumers. In the past year, Experian collected more than 130 million buy now, pay later (BNPL) records from four major BNPL fintech lenders and conducted the most comprehensive analysis of BNPL data available today. The results provided valuable insights on: Who are the consumers using BNPL loans? What is the nature of their current mainstream credit relationships? What do their current BNPL behaviors look like? BNPL myth-busting: Who’s using it, how much are they spending and how risky are BNPL loans? Since BNPL launched in the United States in the 2010s, BNPL has exploded into the consciousness of online shoppers, especially during the COVID-19 pandemic.  According to Forrester, Millennials are the biggest adopters of BNPL at 18%, followed by their younger counterparts in Gen Z at 11%.1 But looking at statistics like these without additional analysis could be problematic.  The dramatic growth of leading BNPL fintechs such as Klarna, Affirm and Afterpay has demonstrated how strongly these services resonate with consumers and retailers. The growth of BNPL has attracted the attention of established lenders interested in capitalizing on the popularity of these services (while also looking to minimize its impact on their existing services, such as credit cards or personal loans). Meanwhile, the Consumer Financial Protection Bureau (CFPB) has urged caution about potential risks, calling for more consistent consumer protections market-wide and transparency into consumer debt accumulation and overextension across lenders. The underlying assumptions debated are that BNPL is used: Predominantly by young people with limited incomes and credit history To pay for frequent, low-value purchases using a cheap and readily available source of credit As a result, it is often seen as a riskier form of lending. But are these assumptions correct? Using data from more than 130 million BNPL transactions from four leading BNPL fintech lenders, we’ve obtained a more detailed and comprehensive understanding of BNPL users and their defining features. Our findings look somewhat different to the popular stereotypes. Myth 1: BNPL is used only for low-value purchases According to our analysis, most BNPL purchases, 95 percent are for items costing $300 or less.2 Some of it is low-value, but not all. In fact, we found that the average purchase using BNPL was similar to that of a credit card, at $132.Average transaction sizes have increased 10 percent year-over-year, and we now see BNPL purchases for goods costing well over $1,000. We also see that consumers take out an average of 5 BNPL loans in a year and 23 percent of them have loans with more than one BNPL provider at a time. Myth 2: BNPL is simply an easier payment method Consumers see BNPL as a simple, quick and convenient way to pay. But, as shoppers receive goods for which payment is deferred, it’s also a form of credit. However, unlike short-term high-interest loans, BNPL credit comes at zero cost to the borrower, with some, but not all BNPL fintech providers charging late payment fees – fueling many borrowers’ sense that it’s an easy way to pay, rather than a loan. Myth 3: Only Gen Z shoppers aged 25 and below are using BNPL Younger shoppers are slightly more represented in the data transactions, but our analysis shows consumers of all ages use BNPL. BNPL is going mainstream, and its appeal is widening. The average age of BNPL consumers is 36 years old, with an average credit history of 9 years.2 The ease of use of these services at the checkout means they have a broad appeal. Over half of U.S. adults have reported using a BNPL service at least once. Despite Millennials and Gen Z having used BNPL financing the most, Gen Xers are not too far behind in usage, with 52% having used it.2 We anticipate that in the use of BNPL will continue to grow as more customers become more familiar with the benefits, and the diversification of products continues. Understanding the opportunities this growth presents to both consumers and lenders is critical to protecting their interests. And helping to facilitate access to credit, enabling responsible spending, while also limiting risks and providing services that consumers can afford is also critical. Download the full guide for additional myths we’re exposing We will take a deep dive into what our early data analysis suggests about the market and the BNPL myths our analysis is exposing. Additionally, we will examine: Why BNPL data matters to providers and lenders How BNPL data can improve visibility of consumers’ creditworthiness Ways in which transparency of BNPL data could benefit consumers 1The Buy Now, Pay Later (BNPL) Opportunity,” Forrester Report, April 29, 2022.2Experian data and analytics derived from 130M+ BNPL transactions

From awarding bonus points on food delivery purchases to incorporating social media into their marketing efforts, credit card issuers have leveled up their acquisition strategies to attract and resonate with today’s consumers. But as appealing as these rewards may seem, many consumers are choosing not to own a credit card because of their inability to qualify for one. As card issuers go head-to-head in the battle to reach and connect with new consumers, they must implement more inclusive lending strategies to not only extend credit to underserved communities, but also grow their customer base. Here’s how card issuers can stay ahead: Reach: Look beyond the traditional credit scoring system With limited or no credit history, credit invisibles are often overlooked by lenders who rely solely on traditional credit information to determine applicants’ creditworthiness. This makes it difficult for credit invisibles to obtain financial products and services such as a credit card. However, not all credit invisibles are high-risk consumers and not every activity that could demonstrate their financial stability is captured by traditional data and scores. To better evaluate an applicant’s creditworthiness, lenders can leverage expanded data sources, such as an individual’s cash flow or bank account activity, as an additional lens into their financial health. With deeper insights into consumers’ banking behaviors, card issuers can more accurately assess their ability to pay and help historically disadvantaged populations increase their chances of approval. Not only will this empower underserved consumers to achieve their financial goals, but it provides card issuers with an opportunity to expand their customer base and improve profitability. Connect: Become a financial educator and advocate Credit card issuers looking to build lifelong relationships with new-to-credit consumers can do so by becoming their financial educator and mentor. Many new-to-credit consumers, such as Generation Z, are anxious about their finances but are interested in becoming financially literate. To help increase their credit understanding, card issuers can provide consumers with credit education tools and resources, such as infographics or ‘how-to’ guides, in their marketing campaigns. By learning about the basics and importance of credit, including what a credit score is and how to improve it, consumers can make smarter financial decisions, boost their creditworthiness, and stay loyal to the brand as they navigate their financial journeys. Accessing credit is a huge obstacle for consumers with limited or no credit history, but it doesn’t have to be. By leveraging expanded data sources and offering credit education to consumers, credit card issuers can approve more creditworthy applicants and unlock barriers to financial well-being. Visit us to learn about how Experian is helping businesses grow their portfolios and drive financial inclusion. Visit us

Student loan forbearance, part of the Coronavirus Aid, Relief, and Economic Security (CARES Act) economic stimulus bill that paused student loan repayment, interest accrual, and collections, is set to expire on May 1, 2022.  Borrowers who carry  federal student loans in the United States need to anticipate the resumption of repayment and interest accrual. In this article, we’ll answer questions your borrowers will be asking about the end of the student loan pause and how they can better prepare.   Lenders and servicers should anticipate an influx of requests for modification and for private student loan lenders, a potential significant push for refinancing.   When do student loans resume and when does student loan interest start again?  Student loan repayments and resumption of interest accruals are set to resume on May 1, 2022. This means that student loans will start accruing interest again, and payments will need to resume on the existing payment date. In other words, if the due date prior to the pause was the fifth of every month, the first repayment date will be May 5, 2022.  In the weeks preceding this, borrowers can expect a billing statement from their student loan servicer outlining their debt and terms or they can reach out to their servicers directly to get more information.  Will student loan forbearance be extended again? Will the CARES Act be extended?  There is no indication that the federal government will extend student loan forbearance beyond May 1, 2022, which was already extended beyond the original deadline in February 2022. Your borrower’s best strategy is to prepare now for the resumption of repayments, interest accrual and collections. Will Biden forgive student loans?  Free community college tuition and federal student loan forgiveness up to $10,000 were a centerpiece of the Biden platform during his candidacy for president and were included in early iterations of the government's Build Back Better agenda. In February 2022, during bargaining, the administration removed the free tuition provision from the bill. The Build Back Better bill has yet to pass.  Although there remains a student loan relief provision in the draft Build Back Better agenda, there is no guarantee that it will make it into the final iteration.  What should borrowers do if they paid student loans using auto-debit?  Most borrowers will need to restart auto-debit after the student loan pause. If auto-debit or ACH was used prior to the student loan pause went into effect on March 13, 2020, borrowers can expect to receive a communication from their servicer confirming they wish to continue with auto-debit. If the borrower doesn’t respond to this notice, the servicer may cancel auto-debit. If the borrower signed up for auto-debit after the beginning of forbearance, payments should automatically begin.  How much interest will borrowers have to pay?  Unless terms have changed, such as consolidating loans, the interest rate will be the same as it was before the student loan pause went into effect.  Will balances be the same as they were before the student loan pause? Will it take the same amount of time to pay off the student loan?  For those on a traditional repayment plan, a student loan servicer might recalculate the amount based on the principal and interest and the amount of time left in the repayment period. Borrowers will still make payments for the same number of months in total, but the end date for repayment will be pushed forward to accommodate the payment pause.   In other words, if the loan terms originally stated that it would be repaid in full on January 1, 2030, the new terms will accommodate the pause and show full repayment on January 1, 2032.  For those on an Income-Driven Repayment Plan (IDRP) – such as Revised Pay as You Earn Repayment (REPAYE), Pay As You Earn Repayment (PAYE), Income-Based Repayment (IBR), or Income-Contingent Repayment (ICR) – the payment amount will resume at the same rate as before the payment pause. Student loan forbearance will not delay progress towards repayment.  What are borrower options if the student loan payment is too high?  Enroll in an IDRP program: Available plans include REPAYE, PAYE, IBR or ICR.  Student loan refinancing: When a borrower refinances, he or she can group federal and private loans and possibly negotiate a lower repayment amount. However, they will not be eligible to access federal loans protections or programs.  Loan consolidation: This process allows borrowers to combine multiple federal loans into a single loan with a single payment, which can reduce monthly payments by extending the repayment period. Note this will result in more interest being charged, as the time to repay will be extended. Will this change affect those with private student loans?  Private lenders are not covered by the CARES Act, so student loan forbearance did not apply to them. Most private lenders have continued collecting repayments throughout the COVID-19 pandemic.   Borrowers having trouble making payments to a private lender, can discuss options such as deferment, forbearance, consolidation and modified repayment terms.  What happens if a student loan payment is missed or the borrower can’t pay at all?   If a payment is missed, the account will be considered delinquent. The account becomes delinquent the first day after a missed payment and remains that way until the past-due amount is paid or other arrangements are made.   If the account remains delinquent, the loan may go into default. The amount of time between delinquency and default depends on the student loan servicer. If the loan goes into default, borrowers could face consequences including:  Immediate collections on the entire loan and interest owed Ineligibility for benefits such as deferment and forbearance,   Inability to choose a different payment plan or obtain additional federal student aid  Damage to credit score  Inability to buy or sell assets  Withholding of tax refunds or other federal benefits Wage garnishment A lawsuit Do student loans affect credit scores?  Yes, for delinquent student loans, the servicer will report the delinquency to the three major credit bureaus and the borrower’s credit score will drop.2 A poor credit score can affect a consumer’s ability to obtain credit cards or loans and may make it difficult to sign up with utilities providers, cell phone providers and insurance agencies. It can also be challenging to rent an apartment.  What are the options for those who can’t pay? Can student loans be deferred?  For those with federal student loans, now is the time to prepare for the end of student loan forbearance. Revisit budgets, make sure records are up to date and communicate with student loan servicers to make sure payments can be made in full and on time.  For those unable to pay back loans, they can consider requesting a deferment. A deferment is a temporary pause on student loan payments. Depending on the type of loan, interest may or may not continue to accrue during the deferment.  If they wish to apply for a deferment, they must meet eligibility requirements. Some common grounds for deferment are:  Economic hardship  Schooling  Military service  Cancer treatment  Loan servicers and private lenders should arm themselves for the large volume of questions  from borrowers who are not prepared to begin resuming payment. Now may the time to increase customer service or consider adding student loan consolidation products to serve the increase in demand.  For information on mitigating risk and effectively managing your portfolio, click here.  

Reporting positive rental payment histories to credit bureaus has been in the news more than once in recent months. In early November, Freddie Mac announced it will provide closing cost credits on multifamily loans for owners of apartment properties who agree to report on-time rental payments. In July, California began requiring multifamily properties that receive federal, state or local subsidies to offer each resident in a subsidized apartment home the option of having their rental payments reported to a major credit bureau. And while reporting positive rental payments to credit bureaus may not yet be part of the multifamily mainstream, forward-thinking operators have already been doing it for years. Below is a quick primer on this practice and its benefits. Why do renters need this service? A strong, positive credit history is critical to securing car loans, credit cards and mortgages – and doing so at favorable interest rates. Unfortunately, unlike homeowners, apartment residents traditionally have not seen a positive impact on their credit reports for making their rent payments on time and in full, even though these payments can be very large and usually make up their largest monthly expense. In fact, renters are seven times more likely to be credit invisible – meaning they lack enough credit history to generate a credit score – than homeowners, according to the Credit Builders Alliance (CBA). This especially impacts lower-income households and communities of color. Renters make up approximately 60% of the U.S. households that make less than $25,000 a year, while Black and Hispanic households are twice as likely as White households to rent, according to the CBA. Experian is among the organizations working with the Consumer Data Industry Association (CDIA) on the association's Rental Empowerment Project. Through the REP, CDIA and its partner organizations seek to increase the reporting of rental payment history information by landlords and property managers through the development and adoption of a uniform, universal data reporting format for landlords and property managers to use. How does reporting positive rental payments to credit bureaus have an impact on a resident's credit history? The impact on any individual renter will obviously vary because of a wide array of factors. But to get some sense of the potential impact reporting on-time rental payments can have, consider the results of the CBA's Power of Rent Reporting pilot. In that test, 100% of renters who started off with no credit score became scorable at the near prime or prime level. In addition, residents with subprime scores saw their score increase by an average of 32 points. How does reporting positive rent payments benefit rental-housing owners and operators? Reporting positive rental payments provides residents with a powerful incentive to pay their rent on time and in full. And because there’s not a huge percentage of apartment communities currently doing this, helping residents build their credit history in this manner can offer a real competitive advantage. Learn more

Nearly 28 million American consumers are credit invisible, and another 21 million are unscorable.1 Without a credit report, lenders can’t verify their identity, making it hard for them to obtain mortgages, credit cards and other financial products and services. To top it off, these consumers are sometimes caught in cycles of predatory lending; they have trouble covering emergency expenses, are stuck with higher interest rates and must put down larger deposits. To further our mission of helping consumers gain access to fair and affordable credit, Experian recently launched Experian GOTM, a first-of-its-kind program aimed at helping credit invisibles take charge of their financial health. Supporting the underserved Experian Go makes it easy for credit invisibles and those with limited credit histories to establish, use and grow credit responsibly. After authenticating their identity, users will have their Experian credit report created and will receive educational guidance on improving their financial health, including adding bill payments (phone, utilities and streaming services) through Experian BoostTM. As of January 2022, U.S. consumers have raised their scores by over 87M total points with Boost.2 From there, they’ll receive personalized recommendations and can accept instant card offers. By leveraging Experian Go, disadvantaged consumers can quickly build credit and become scorable. Expanding your lending portfolio So, what does this mean for lenders? With the ability to increase their credit score (and access to financial literacy resources), thin-file consumers can more easily meet lending eligibility requirements. Applicants on the cusp of approval can move to higher score bands and qualify for better loan terms and conditions. The addition of expanded data can help you make a more accurate assessment of marginal consumers whose ability and willingness to pay aren’t wholly recognized by traditional data and scores. With a more holistic customer view, you can gain greater visibility and transparency around inquiry and payment behaviors to mitigate risk and improve profitability. Learn more Download white paper 1Data based on Oliver Wyman analysis using a random sample of consumers with Experian credit bureau records as of September 2020. Consumers are considered ‘credit invisible’ when they have no mainstream credit file at the credit bureaus and ‘unscorable’ when they have partial information in their mainstream credit file, but not enough to generate a conventional credit score. 2https://www.experian.com/consumer-products/score-boost.html

The payments landscape is rapidly evolving, and as businesses set their strategic agendas for the new year, it’s important to analyze and adapt to changing consumer payment behaviors. Here are a few payment trends to look out for: Consumer sentiment remains low while inflation hits 39-year high According to the University of Michigan’s latest consumer sentiment survey, sentiment rose to 70.4 in December 2021 from 67.4 in November. While this was a slight improvement from the 10-year low logged in November, the figure was roughly in line with the average reading of the past four months (70.6). Additionally, consumer prices increased 6.8% over the past year, the highest in nearly 40 years. When asked whether inflation or unemployment was the more serious problem facing the nation, 76% of survey respondents selected inflation while 21% selected unemployment. Rising prices and the uncertainty surrounding the Delta and Omicron variants may cause consumers to remain pessimistic about their personal financial progress and delay large purchases. Payment preferences vary by age and purchase type According to a recent Mintel report, credit cards are the most preferred method of payment among U.S. adults. Despite the overall preference for credit cards, attitudes toward this payment option differ based on consumer age. Credit card preference skews strongly toward older consumers, with 46% of Baby Boomers opting to use credit cards for most of their purchases and 72% of the World War II generation preferring credit cards to any other payment type. Conversely, younger generations are turning to cash, debit cards and digital payment alternatives for most of their purchases. This difference can be explained by younger consumers’ fear of debt and lack of credit education. While older consumers may feel more comfortable and capable of paying off their credit card bill each month, most Gen Z consumers are not creditworthy enough to own a credit card or are afraid of falling behind on their monthly payments. Though Gen Z’s low ownership rate may seem concerning to credit card issuers, there’s an enormous opportunity for them to reach and engage this younger cohort. By educating younger consumers about their products and the importance of building credit, credit card issuers can build lasting customer relationships and maintain their standing in the payments hierarchy. Payment preferences also vary by purchase type. Consumers mostly use debit cards and credit cards for in-store purchases, while direct payments from bank accounts are used to pay off recurring bills. Despite these preferences for card and online payments, cash remains a popular secondary payment method across age demographics. Older consumers use cash to make small, personal transactions, while younger consumers are more likely to use cash or debit cards for large purchases. Digital payment popularity continues to soar From 2019 to 2020, peer-to-peer payment (P2P) services, like Venmo, Zelle and Cash App, saw usage increases of 2 to 3 percentage points. In 2021, that year-over-year increase jumped to 8, 9 and 7 percentage points respectively. This jump indicates that while consumers may have been reluctant to adjust their payment behaviors at the beginning of the pandemic, ongoing social distancing measures forced them to adapt to a new reality, leading to the widespread adoption of digital payment methods. As consumers continue to embrace P2P services, traditional payment powerhouses must pivot their strategies to capitalize on this trend and remain competitive in today’s payments landscape. To keep up with the latest consumer and economic trends, register for our upcoming Monthly Credit and Economic Trends webinar.

Consumer behavior and payment trends are constantly evolving, particularly in a rapidly changing economic environment. Faced with changing demands, including an accelerated shift to digital communications, and new regulatory rules, debt collectors must adapt to advance in the new collections landscape. According to Experian research, as of August, the U.S. unemployment rate was at 8.4%, with numerous states still having employment declines over 10%. These triggers, along with other recent statistics, signal a greater likelihood of consumers falling delinquent on loans and credit card payments. The issue for debt collectors? Many debt collection departments and agencies are not equipped to properly handle the uptick in collection volumes. By refining your process and capabilities to meet today’s demands, you can increase the success rate of your debt collection efforts. Join Denise McKendall, Experian’s Director of Collection Solutions, and Craig Wilson, Senior Director of Decision Analytics, during our live webinar, "Adapting to the New Collections Landscape," on October 21 at 10:00 a.m. PT. Our expert speakers will provide a view of the current collections environment and share insights on how to best adapt. The agenda includes: Meeting today’s collections challenges A Look at the state of the market Devising strategies and solving collections problems across the debt lifecycle Register now

New challenges created by the COVID-19 pandemic have made it imperative for utility providers to adapt strategies and processes that preserve positive customer relationships while continuing to collect delinquent balances during an unpredictable and unprecedented time. As part of our ongoing Q&A perspective series, Beth Bayer, Experian’s Vice President of Energy Sales, and Danielle Grigaliunas, Product Manager of Collection Solutions, discuss the changing collections landscape and how the utility industry can best adapt. Check out what they had to say: Q: How are the COVID-19 crisis and today’s economic environment impacting consumer behavior? Particularly as it relates to delinquencies and payments? BB: Typically, when we experience recessions, delinquency goes up. In this recession, delinquency is declining. Stimulus money and increased unemployment benefits, coupled with stay at home orders, appear to be leading to more dollars available for consumers to repay obligations and debts. Another factor is related to special accommodations, forbearances, and payment holidays or extensions, that provide consumers with flexible options in making their regularly scheduled payments. Once an accommodation is granted, the lender or bank puts a code on the account when it’s reported to the bureaus and the account does not continue to age. Q: As a result of the pandemic, many regulatory bodies are recommending or imposing changes to involuntary disconnect policies. How can utility providers effectively collect, even if they can’t disconnect? BB: The public utility commissions in many areas have suspended disconnects due to non-payment, further increasing balances, delinquency and delaying final bill generation. Without the fear of being disconnected for non-payment in some regions of the country, customers are not paying delinquent utility bills. Utility providers should continue to provide payment reminders and delinquency notices and offer payment plans in exchange for partial payments to continue to engage customers. Identifying which customers can pay and are actively paying other creditors and institutions helps prioritize proactive outreach. Q: For utility providers who offer in-house collection services, what strategies and credit data do you find most valuable? DG: Current and accurate data is key when looking to provide stronger and more strategic collections. This data is built into efficient scoring models to articulate which debts are most collectible and how much money will be recovered from each consumer. Without the overlay of credit data, it’s harder for utility providers to predict how consumers prioritize utility debt during times of economic stress. By better understanding the current state of the consumer, utility providers can focus on consumers who are most likely to pay. Investing in monitoring solutions allows utility providers to receive notifications when their consumers are beginning to cure and pay off other obligations and take a more proactive approach. Q: What are the best methods for utility providers to reach collection consumers? What do they need to know as they begin to utilize omnichannel communications? DG: Regular data hygiene checks and skipping are the first line of defense in collections. Confirming contact information is correct and up to date throughout the entire consumer lifecycle helps to establish a strong relationship. Those who are successful in collections invest in omnichannel messaging and self-service payment options, so consumers have a choice on how they’d like to settle their obligations. Q: What current collection trends/challenges are we seeing within the utility space? BB: Utility providers do not traditionally report active customer payments and delinquencies to the credit bureaus. Anecdotally, our utility partners tell us that delinquencies are up and balances are growing. Many customers know that they cannot currently be disconnected if they fall behind on their utility payments and are using this opportunity to prioritize other debts. We also know that some utilities have reduced collection activities during the pandemic due to office closures and have cut back on communication efforts. Additionally, we’re hearing from some of our utility partners that collections and recoveries of final billed or charged-off accounts are increasing, despite many agencies closing and limited to no collection activities occurring. We assume this is because these balances are typically reported to the credit reporting agencies, triggering a payment and interest in clearing that balance first. Constant communication, flexibility, and empathizing with your customers by offering payment plans and accommodations will lead to an increase in dollars collected. DG: There’s been a large misunderstanding that because utility providers can’t disconnect, they can’t attempt to collect. The success of collections has been seen within first parties, as they are still maintaining strong relationships by reaching out at optical times and remaining top-of-mind with consumers. The utility industry needs to take a proactive approach to ensure they are focusing on the right consumers through the right channels at the right time. Credit data that matches the consumer’s credit health (i.e. credit usage and payments) is needed insight when trying to understand a consumer’s overall financial standing. For more insight on how to enhance your collection processes and capabilities, watch our Experian Symposium Series event on-demand. Watch now About our Experts: Beth Bayer, Vice President of Sales, Experian Energy, North America Beth leads the Energy Vertical at Experian, supporting regulated, deregulated and alternative energy companies throughout the United States. She strives to bring innovative solutions to her clients by leveraging technology, data and advanced analytics across the customer lifecycle, from credit risk and identity verification through collections. Danielle Grigaliunas, Product Manager of Collections Solutions, Experian Consumer Information Services, North America Danielle has dedicated her career to the collections space and has spent the last five years with Experian, enhancing and developing collections solutions for various industries and debt stages. Danielle’s focus is ensuring that clients have efficient, compliant and innovative collection and contact strategies.

Do consumers pay certain types of credit accounts before others during financial distress? For instance, do they prioritize paying mortgage bills over credit card bills or personal loans? During the Great Recession, the traditional notion of payment priority among multiple credit accounts was upended, throwing strategies employed by financial institutions into disarray. Similarly, current circumstances in the context of COVID-19 might cause sudden shifts in prioritization of payments which might have a dramatic impact on your credit portfolio. Financial institutions would be better able to forecast and control exposure to credit risk, and to optimize servicing practices such as forbearance and collections treatments if they could understand changing customer payment behaviors and priorities of their existing customers across all open trades.  Unfortunately, financial institutions’ data—including their own behavioral data and refreshed credit bureau data--are limited to information about their own portfolio. Experian data provides insight which complements the financial institutions’ data expanding understanding of consumer payment behavior and priorities spanning all trades. Experian recently completed a study aimed at providing financial institutions valuable insights about their customer portfolios prior to COVID-19 and during the initial months of COVID-19. Using the Experian Ascend Technology Platform™, our data scientists evaluated a random 10% sample of U.S. consumers from its national credit file. Data from multiple vintages were pulled (June 2006, June 2008 and February 2018) and the payment trends were studied over the subsequent performance period. Experian tabulated the counts of consumers who had various combinations of open and active trade types and selected several trade type combinations with volume to differentiate performance by trade type. The selected combinations collectively span a variety of scenarios involving six trade types (Auto Loans, Bankcard, Student Loan, Unsecured Personal Loans, Retail Cards and First Mortgages). The trade combinations selected accommodate a variety of lenders offering different products. For each of the consumer groups identified, Experian calculated default rates associated with each trade type across several performance periods. For brevity, this blog will focus on customers identified as of February 2018 and their subsequent performance through February 2020. As the recession evolves and when the economy eventually recovers, we will continue to monitor the impacts of COVID-19 on consumer payment behavior and priorities and share updates to this analysis. Consumers with Bankcard, Mortgage, Auto and Retail accounts Among consumers having open and recently active Bankcard, Mortgage, Auto and Retail accounts, bankcard delinquency was highest throughout the 24-month performance window, followed by Retail.  Delinquency rates for Auto and Mortgage were the lowest. During the pre-COVID-19 period, consumers paid their secured loans before their unsecured loans. As demonstrated in the table below, customer payment priority was stable across the entire 24-month period, with no significant shift in payment priorities between trade types. Consumers with Unsecured Personal Loan, Retail Card and Bankcard accounts. Among consumers having open and recently active Unsecured Personal Loan, Retail Card and Bankcard accounts, consumers are likely to pay unsecured personal loans first when in financial distress. Retail is the second priority, followed by Bankcard. KEY FINDINGS From February 2018 through April 2020, relative payment priority by trade type has been stable Auto and Mortgage trades, when present, show very high payment priority Download the full Payment Hierarchy Report here. Download Now Learn more about how Experian can create a custom payment hierarchy for the customers in your own portfolio, contact your Experian Account Executive, or visit our website.

The COVID-19 pandemic has created unprecedented challenges for the utilities industry. This includes the need to plan for – and be prepared to respond to – changing behaviors and a sudden uptick in collections activities. As part of our recently launched Q&A perspective series, Mark Soffietti, Experian’s Senior Manager of Analytics Consulting and Tom Hanson, Senior Energy Consultant, provided insight on how utility providers can evolve and refine their collections and recovery processes. Check out what they had to say: Q: How has COVID-19 impacted payment behavior and debt collections? TH: Consumer payment behavior is changing. For example, those who paid as agreed, may not currently have the means to pay and are now distressed borrowers. Or those who were sloppy payers before the pandemic may now be defaulting on a more consistent basis. MS: As we saw with the last recession when faced with economic stress, consumer and commercial payment behavior changes based on their needs and current cash flow. For example, people prioritize their car, as they need it to get to and from work, so they’ll likely pay their auto bills on time. The same goes for their credit cards, which they need to make ends meet. We expect this will also be true with COVID-19. The commercial segment will face more dramatic and challenging circumstances, where complete or partial business closures and lack of federal relief could have severe ramifications. Q: What new restrictions have been put in place surrounding debt collection efforts and outbound calls? TH: To protect consumers who may be experiencing financial distress, most states have imposed new, stringent restrictions to prevent utilities from engaging in certain collections activities. Utilities are currently not charging any late payment fees and are instead structuring payment plans. Additionally, all outbound collections efforts have been suspended and there is fieldwork being executed of services for both commercial and consumer properties. As of now, consumer and commercial fieldwork will likely not commence until after the first year or when the winter moratorium concludes. MS: The new restrictions imposed upon collections activities will likely drive consumer payment behavior. If consumers know that their utilities (i.e. energy and water) will not be shut off if they miss a payment, they will make these bills less of a priority. This will dramatically increase the amount owed when these restrictions are lifted next year. Q: Can we predict how the utilities industry will fare post-COVID-19? TH: The volume of accounts in collections and eligible for disconnect will be overwhelming. Many utility providers fear the unpaid balances consumers and commercial entities accumulate will be nearly impossible to fit into a repayment schedule. Both analyzing internal payment segments and overlaying external factors may be the best way to optimize the most critical go-forward plan. MS: The amount of people who fall into collections is going to greatly increase and utility providers need to start planning for it now to weather the storm. They will need to use data, analytics and tools to help them optimize their tasks, so they can be more efficient with their resources. Like many other industries, the utilities sector will look to increasing digitalization of their processes and having less social interaction where possible. This could mean the need and drive for expediting current smart meter programs where possible to enable remote fieldwork to assist in managing this unprecedented level of activity that is sure to overwhelm field operations (where allowed by state regulators). Q: What should utility providers be doing to plan for an uptick in collections activities post-COVID-19? TH: With regulatory mandated suspensions of collections activities for utility providers and self-selected reductions due to stay at home orders and staff protection, the backlog of payments, calls and inquiries once business resumes as normal is set to overwhelm existing capacity. More than ever, self-service options (text/web), Q&A and alternative communication methods will be needed to shepherd consumers through the collections process and minimize the strain on call center agents. Many utility providers are asking for external data points to segment their consumers by industry or by those whose employment would have been adversely impacted by COVID-19. MS: Utility providers should be monitoring consumer data in order to prepare for when they are able to collect. This will help them strategize the number of resources they will need in their call centers and out in the field performing shut off activities. Given that the rise in cases will be more volume than their call centers can handle, they will need to use their resources wisely and plan to use them efficiently when they are able to resume collections. Q: How can Experian help utility providers reduce collections costs and maximize recovery? TH: Experian can help revise collections tactics and segmentation strategies by providing insight on how consumers are paying other creditors and identifying new segmentation opportunities as we emerge from the freeze on collections activities. Collections cases will be complex, and many factors and constraints will need to balanced against changing goals, making optimization key. MS: Utilizing Experian’s credit data and models can help ensure that resources are being used efficiently (i.e. making successful calls). There is also a need to leverage ability to pay models as well as prioritization models. By using these models and tools, utility providers can optimize their treatment strategies, reduce costs and maximize dollars collected. Learn more About our Experts: Tom Hanson, Senior Energy Consultant, Experian CEM, North America Tom is a Senior Consultant within the Energy Vertical at Experian, supporting regulated energy companies throughout the U.S. He brings over 25 years of experience in the energy field and supports his clients throughout the customer lifecycle, providing expertise in ID verification, account treatment, fraud solutions, analytics, consulting and final bill/field optimization strategies and techniques. Mark Soffietti, Analytics Consulting Senior Manager, Experian Decision Analytics, North America Mark has over 15 years of experience transforming data into actionable knowledge for effective decision management. Mark’s expertise includes solution development for consumer and commercial lending across the credit spectrum – from marketing to collections.

The coronavirus (COVID-19) outbreak is causing widespread concern and economic hardship for consumers and businesses across the globe – including financial institutions, who have had to refine their lending and downturn response strategies while keeping up with compliance regulations and market changes. As part of our recently launched Q&A perspective series, Shannon Lois, Experian’s Head of DA Analytics and Consulting and Bryan Collins, Senior Product Manager, tackled some of the tough questions for lenders. Here’s what they had to say: Q: What trends and triggers should lenders be prepared to react to? BC: Lenders are still trying to figure out how to assess risk between the broader, longer-term impacts of the pandemic and the near-term Coronavirus Aid, Relief, and Economic Security (CARES) Act that extends relief funds and deferment to consumers and small businesses. Traditional lending processes are not possible, lenders will have to adjust underwriting strategies and workflows as they deploy hardship programs while complying with the Act. From a utilization perspective, lenders need to look for near-term trends on payments, balances and skipped payments. From an extension standpoint, they should review limits extended or reduced by other lenders. Critical trends to look for would be missed or late auto payments, non-traditional credit shopping and rental payment delinquencies. Q: What should lenders be doing to plan for an uptick in delinquencies? SL: First, lenders should make sure they have a complete picture of how credit risk and losses are evolving, as well as any changes to their consumers’ affordability status. This will allow a pointed refinement of their customer management strategies (I.e. payment holidays, changing customer to cheaper product, offering additional services, re-pricing, term amendment and forbearance management.) Second, given the increased stress on collection processes and regulations guidelines, they should ensure proper and prepared staffing to handle increased call volumes and that agency outsourcing and automation is enabled. Additionally, lenders should migrate to self-service and interactive communication channels whenever possible while adopting new segmentation schemas/scores/attributes based on fresh data triggers to queue lower risk accounts entering collections. Q: How can lenders best help their customers? SL: Lenders should understand customers’ profiles with vulnerability and affordability metrics allowing changes in both treatment and payment. Payment Holidays are common in credit card management, consider offering payment freezes on different types of credit like mortgage and secured loans, as well as short term workout programs with lower interest rates and fee suppression. Additionally, lenders should offer self-service and FAQ portals with information about programs that can help customers in times of need. BC: Lenders can help by complying with aspects of the CARES Act guidance; they must understand how to deploy payment relief and hardship programs effectively and efficiently. Data integrity and accuracy of loan reporting will be critical. Financial institutions should adjust their collection and risk strategies and processes. Additionally, lenders must determine a way to address the unbanked population with relief checks. We understand how challenging it is to navigate the changing economic tides and will continue to offer support to both businesses and consumers alike. Our advanced data and analytics can help you refine your lending processes and better understand regulatory changes. Learn more About Our Experts: Shannon Lois, Head of DA Analytics and Consulting, Experian Data Analytics, North America Shannon and her team of analysts, scientists, credit, fraud and marketing risk management experts provide results-driven consulting services and state-of-the-art advanced analytics, science and data products to clients in a wide range of businesses, including banking, auto, credit, utility, marketing and finance. Shannon has been a presenter at many credit scoring and risk management conferences and is currently leading the Experian Decision Analytics advisory board. Bryan Collins, Senior Product Manager, Experian Consumer Information Services, North America Bryan is a member of Experian's CIS product management team, focusing on the Acquisitions suite and our evolving Ascend Identity Services Platform. With more than 20 years of experience in the financial services and credit industries, Bryan has established strong partnerships and a thorough understanding of client needs. He was instrumental in the launch of CIS's segmentation suite and led product management for lender and credit-related initiatives in Auto. Prior to joining Experian, Bryan held marketing and consumer experience roles in consumer finance, business lending and card services.

This is the second in a series of blog posts highlighting optimization, artificial intelligence, predictive analytics, and decisioning for lending operations in times of extreme uncertainty. The first post dealt with optimization under uncertainty. The word "unprecedented" gets thrown around pretty carelessly these days. When I hear that word, I think fondly of my high school history teacher.  Mr. Fuller had a sign on his wall quoting the philosopher-poet George Santayana: "Those who cannot remember the past are condemned to repeat it." Some of us thought it meant we had to memorize as many facts as possible so we wouldn't have to go to summer school. The COVID-19 crisis--with not only health consequences but also accompanying economic and financial impacts--certainly breaks with all precedents.  The bankers and other businesspeople I've been listening to are rightly worried that This Time is Different. While I'm sure there are history teachers who can name the last time a global disaster led to a widescale humanitarian crisis and an economic and financial downturn, I'm even more sure times have changed a lot since then. But there are plenty of recent precedents to guide business leaders and other policymakers through this crisis. Hurricanes Katrina and Sandy impacted large regions of the United States, with terrible human consequences followed by financial ones. Dozens of local disasters—floods, landslides, earthquakes—devastated smaller numbers of people in equally profound ways. The Great Recession, starting in 2008, put millions of Americans and others around the world out of work. Each of those disasters, like this one, broke with all precedents in various ways. Each of those events was in many ways a dress rehearsal, as bankers and other lenders learned to provide assistance to distressed businesses and consumers, while simultaneously planning for the inevitable changes to their balance sheets and income statements. Of course, the way we remember the past has changed. Just as most of us no longer memorize dates--we search for them on the web--businesspeople turn to their databases and use analytics to understand history. I've been following closely as the data engineers and data scientists here at Experian have worked on perhaps their most important problem ever. Using Experian's Ascend Analytical Sandbox--named last year as the Best Overall Analytics Platform, they combed through over eighteen years of anonymized historical data covering every credit report in the United States. They asked--using historical experience, wisdom, time-consuming analytics, a little artificial intelligence, and a lot of hard work--whether predicting credit performance during and after a crisis is possible. They even considered scenarios regarding what happens as creditors change the way they report consumer delinquencies to the credit bureaus. After weeks of sleepless nights, they wrote down their conclusions.  I've read their analysis carefully and I’m pleased to report that it says…Drumroll, please…Yes, but. Yes, it's possible to predict consumer behavior after a disaster. But not in precisely the same way those predictions are made during a period of economic growth. For a credit risk manager to review a lending portfolio and to predict its credit losses after a crisis requires looking at more data--and looking at it a little differently--than during other periods. Yes, after each disaster, credit scores like FICO® and VantageScore® credit scores continued to rank consumers from most likely to least likely to repay debts. But the interpretation of the score changes. Technically speaking, there is a substantial shift in the odds ratio that is particularly pronounced when a score is applied to subprime consumers. To predict borrower behavior more accurately, our scientists found that it helps to look at ten additional categories of data attributes and a few additional types of mathematical models. Yes, there are attributes on the credit report that help lenders identify consumer distress, willingness, and ability to pay. But, the data engineers identified that during times like these it is especially helpful to look beyond a single point in time; trends in a consumer's payment history help understand whether that customer is changing their typical behavior. Yes, the data reported to the credit bureaus is predictive, especially over time. But when expanded FCRA data is available beyond what is traditionally reported to a bureau, that data further improves predictions. All told, the data engineers found over 140 data attributes that can help lenders and others better manage their portfolio risk, understand consumer behavior, appreciate how the market is changing, and choose their next best action. The list of attributes might be indispensable to a credit data specialist whose institution needs to weather the coming storm. Because Experian knows how important it is to learn from historical precedents, we're sharing the list at no charge with qualified risk managers. To get the latest Experian data and insights or to request the Crisis Response Attributes recommendation, visit our Look Ahead 2020 page. Learn more

Article written by Alex Lintner, Experian's Group President of Consumer Information Services and Sandy Anderson, Experian's Senior Vice President of Client and Sales Operations Many consumers are facing financial stress due to unemployment and other hardships related to the COVID-19 pandemic. Not surprisingly, data scientists at Experian are looking into how consumers’ credit scores may be impacted during the COVID-19 national emergency period as financial institutions and credit bureaus follow guidance from financial regulators and law established in Section 4021 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). In a nutshell, Experian finds that if consumers contact their lenders and are granted an accommodation, such as a payment holiday or forbearance, and lenders report the accommodation accordingly, consumer scores will not be materially affected negatively. It’s not just Experian’s findings, but also those of the major credit scoring companies, FICO® and VantageScore®. FICO has reported that if a lender provides an accommodation and payments are reported on time consistent with the CARES Act, consumers will not be negatively impacted by late payments related to COVID-19. VantageScore® has also addressed this issue and stated that its models are designed to mitigate the impact of missed payments from COVID-19. At the same time, if as predicted, lenders tighten underwriting standards following 11 consecutive years of economic growth, access to credit for some consumers may be curtailed notwithstanding their score because their ability to repay the loan may be diminished. Regulatory guidance and law provide a robust response Recently, the Federal Reserve, along with the federal and state banking regulators, issued a statement encouraging mortgage servicers to work with struggling homeowners affected by the COVID-19 national emergency by allowing borrowers to defer mortgage payments up to 180-days or longer. The Federal Deposit Insurance Corporation stated that financial institutions should “take prudent steps to assist customers and communities affected by COVID-19.” The Office of the Comptroller of the Currency, which regulates nationally chartered banks, encouraged banks to offer consumers payment accommodations to avoid delinquencies and negative credit bureau reporting. This regulatory guidance was backed by Congress in passing the CARES Act, which requires any payment accommodations to be reported to a credit bureau as “current.” The Consumer Financial Protection Bureau, which has oversight of all financial service providers, reinforced the regulatory obligation in the CARES Act. In a statement, the Bureau said “the continuation of reporting such accurate payment information produces substantial benefits for consumers, users of consumer reports and the economy as a whole.” Moreover, the consumer reporting industry has a history of successful coordination during emergency circumstances, like COVID-19, and we’ve provided the support necessary for lenders to report accurately and consistent with regulatory guidance. For example, when a consumer faces hardship, a lender can add a code that indicates a customer or borrower has been “affected by natural or declared disaster.” If a lender uses this or a similar code, a notification about the disaster or other event will appear in the credit report with the trade line for the customer’s account and will remain on the trade line until the lender removes it. As a result, the presence of the code will not negatively impact the consumer credit score. However, other factors may impact a consumer’s score, such as an increase in a consumer’s utilization of their credit lines, which is a likely scenario during a period of financial stress. Suppression or Deletion of late payments will hurt, not help, credit scores In response to the nationwide impact of COVID-19, some lawmakers have suggested that lenders should not report missed payments or that credit bureaus should delete them. The presumption is that these actions would hold consumers harmless during the crisis caused by this pandemic. However, these good intentions end up having a detrimental impact on the whole credit ecosystem as consumer credit information is no longer accurately reflecting consumers’ specific situation. This makes it difficult for lenders to assess risk and for consumers to obtain appropriately priced credit. Ultimately, the best way to help is a consumer-specific solution, meaning one in which a lender reaches an accommodation with each affected individual, and accurately reflects that person’s unique situation when reporting to credit bureaus. When a consumer misses a payment, the information doesn’t end up on a credit report immediately. Most payments are monthly, so a consumer’s payment history with a financial institution is updated on a similar timeline. If, for example, a lender was required to suppress reporting for three months during the COVID-19 national emergency, the result would be no data flowing onto a credit report for three months. A credit report would therefore show monthly payments and then three months of no updates. The same would be true if a credit reporting agency were required to suppress or delete payment information. The lack of data, due to suppression or deletion, means that lenders would be blinded when making credit decisions, for example to increase a credit limit to an existing customer or to grant a new line of credit to a prospective customer. When faced with a blind spot, and unable to assess the real risk of a consumer’s credit history, the prudential tendency would be to raise the cost of credit, or to decrease the availability of credit, to cover the risk that cannot be measured. This could effectively end granting of credit to new customers, further stifling economic recovery and consumer financial health at a time when it’s needed most. Beyond the direct impact on consumers, suppression or deletion of credit information could directly affect the safety and soundness of the nation’s consumer and small business lending system. With missing data, lenders and their regulators would be flying blind as to the accurate information about a consumer’s risk and could result in unknowingly holding loan portfolios with heightened risk for loss. Too many unexpected losses threaten the balance of the financial system and could further seize credit markets. Experian is committed to helping consumers manage their credit and working with lenders on how best to report consumer-specific solutions. To learn more about what consumers can do to manage credit during the COVID-19 national emergency, we’ve provided resources on our website. For individuals looking to explore options their lenders may offer, we’ve included links to many of the companies and update them continuously. With good public policy and consumer-specific solutions, consumers can continue to build credit and help our economy grow.  

There are more than 100 million people in the United States who don’t have a fair chance at access to credit. These people are forced to rely on high-interest credit cards and loans for things most of us take for granted, like financing a family car or getting an apartment. At Experian, we have a fundamental mission to be a champion for the consumer. Our commitment to increasing financial inclusion and helping consumers gain access to the financial services they need is one of the reasons we have been selected as a Fintech Breakthrough Award winner for the third consecutive year. The Fintech Breakthrough Awards is the premier awards program founded to recognize the fintech innovators, leaders and visionaries from around the world. The 2020 Fintech Breakthrough Award program attracted more than 3,750 nominations from across the globe. Last year, Experian took home the award for Best Overall Analytics Platform for our Ascend Analytical Sandbox™, a first-to-market analytics environment that promised to move companies beyond just business intelligence and data visualization to data insights and answers they could use. The year prior, Experian won the Consumer Lending Innovation Award for our Text for Credit™ solution, a powerful tool for providing consumers the convenience to securely bypass the standard-length ‘pen & paper’ or keystroke intensive credit application process while helping lenders make smart, fraud protected lending decisions. This year, we are excited to announce that Experian has been selected once again as a winner in the Consumer Lending Innovation category for Experian Boost™. Experian Boost – with direct, active consumer consent – scans eligible accounts for ‘boostable’ positive payment data (e.g., utility and telecom payments) and provides the means for consumers to add that data to their Experian credit reports. Now, for the very first time, millions of consumers benefit from payments they’ve been making for years but were never reflected on their credit reports. Since launching in March 2019, cumulatively, more than 18 million points have been added to FICO® Scores via Experian Boost. Two-thirds of consumers who completed the Experian Boost process increased their FICO Score and among these, the average score increase has been more than 13 points, and 12% have moved up in credit score category. “Like many fintechs, our goal is to help more consumers gain access to the financial services they need,” said Alex Lintner, Group President of Experian Consumer Information Services. “Experian Boost is an example of our mission brought to life. It is the first and only service to truly put consumers in control of their credit. We’re proud of this recognition from Fintech Breakthrough and the momentum we’ve seen with Experian Boost to date.” Contributing consumer payment history to an Experian credit file allows fintech lenders to make more informed decisions when examining prospective borrowers. Only positive payment histories are aggregated through the platform and consumers can remove the new data at any time. There is no limit to how many times one can use Experian Boost to contribute new data. For more information, visit Experian.com/Boost.