Experian®, the leading global information services company, announced its Extended View(SM) score today at the 7th Annual Underbanked Financial Services Forum in San Francisco, Calif.
Extended View is a highly-predictive score designed to assess the creditworthiness of consumers who have little or no traditional credit history--typically referred to as underbanked or underserved consumers.
Extended View is a proprietary credit score developed by Experian that includes three unique data sources: Experian's credit data, rental information and public record data. This product provides a comprehensive view of a consumer's payment behavior and is delivered directly from Experian, which streamlines the loan review process, enabling lenders to expand their underwriting population and offer underbanked consumers financial products that help them build a fuller credit history.
"Experian is committed to helping consumers establish and build credit. Many of the estimated 64 million consumers with limited to no credit history that are unscoreable by traditional credit scores are creditworthy," said Steven Wagner, president, Experian Consumer Information Services. "Extended View can redefine how businesses evaluate this underserved population and empower more consumers with cost-effective credit and financial opportunities."
Experian research shows that 30 percent of the underbanked population display similar behaviors as low credit risk individuals, which indicates that over 20 million underbanked consumers may be eligible for financial products normally reserved for prime credit prospects. These underserved consumers could include individuals who are new to credit, someone who is new to the United States, consumers who are leery of the lending market or even an individual who has satisfied previous credit obligations and now lives on a cash basis.
Extended View score is ideal for a variety of lenders including banks, credit unions and auto lenders, who want to confidently enhance their underwriting strategies to the underbanked market segment. This score is also beneficial to telecommunications companies and utility providers, giving them the am the ability to determine the deposit terms required for new customers. According to a survey(1) conducted by the Center for Financial Services Innovation (CFSI) the majority of financial services providers expect the underbanked population to grow in the next two years. The survey also found that 93 percent of the financial services respondents said that reaching underbanked consumers is important or very important to the future of the industry.
"By leveraging our data analysis expertise and advanced modeling techniques, we are able to offer a score that enables our clients to make better decisions about who to lend to, and what types of terms they can offer," said Michele Pearson, vice president of product management, Experian. "We evaluated multiple non-credit bureau data assets combined with credit and rental data from Experian, applied breakthrough optimization-based analytical techniques and developed over 300 models to ultimately derive Extended View, Experian's new thin file, no hit credit risk assessment score."
Extended View score is Fair Credit Reporting Act (FCRA)-compliant, and offers a simple to implement score range of 401 to 990, closely aligned to VantageScore®, which is the credit industry's first credit score developed jointly by Experian, Equifax and TransUnion.
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