FICO credit scoring service launched in PHL

Posted on October 29, 2016

ANALYTICS software provider Fair Isaac Corp. has brought to the country its credit scoring service touted to provide more Filipinos access to financial services.

In a statement issued on Friday, the New York-listed company announced the launch of its trademark FICO Score for International Markets in the Philippines.

The solution will initially use data from the country’s first credit bureau -- CIBI Information, Inc. -- and its member cooperative banks to appraise the creditworthiness of borrowers.

“Available from today, our national score will help those with limited credit information to gain greater access to financial services,” FICO Senior Vice-President of Scores Andrew Jennings said in the statement.

The partnership between Fair Isaac and CIBI promotes financial inclusion in the Philippines, Mr. Jennings noted, as this allows for the interpretation of financial data covering a single credit line or small consumer segment.

A score is produced by inputting the data to an expert model developed by Fair Isaac, which creates a richer picture of credit risk through analytic interpolation.

The assessment is then used by local banks, telecommunications companies and utilities to decide loan or subscription applications.

“The launch of this score is a welcome addition to efforts to help more people join the middle class and reduce poverty,” CIBI President and Chief Executive officer Marlo R. Cruz was quoted as saying in the statement.

Consumer CreditScore (CCS), the local scoring service partner of Fair Isaac, managing the rollout of the FICO Score for International Markets in the Philippines.

The credit scoring service will undergo commercial trials with banks next month and scores may be issued for loan applications starting December, CSS Director Clive Knott said in the statement.

Mr. Jennings, however, noted that “FICO will be ready from day one to incorporate this collective credit information into the score when it is made available.”

“When the increased pool of consumer files comes online, it will improve the hit rate of our score. This broadens the number of consumers we can then accurately assess.”

The national credit information exchange being advanced by Credit Information Corp. (CIC) will supposedly further the adoption of the FICO Score.

CIC is currently compiling financial records into a national registry expected to become operational in early 2017. The state corporation has fully accredited four special accessing entities so far.

“There has been strong interest from Philippine lenders because the FICO Score is used in more than 25 countries across the world and has a strong brand and reputation when it comes to risk assessment,” Mr. Knott said.

CCS is working with Fair Isaac on the development of another score in the first half of 2017. This will use alternative data to appraise the creditworthiness of consumers with no credit history.

Fair Isaac recently unveiled its FICO Financial Inclusion Initiative that involves business partnerships, new products, mobile platforms and cloud-based services to help lenders make affordable credit accessible. -- Keith Richard D. Mariano