First Data Corp. announced that Equifax Inc. will offer its Confidence Score solution—an alternative scoring tool that provides access to hard-to-locate information on sub-prime, thin-file, and no-credit score consumers.

The First Data Confidence Score solution will help Equifax’s financial institution clients identify new account applicants who have low credit scores or little credit history but might otherwise have the potential to be profitable banking customers. The score can also be used to facilitate new account opening and review decisions in telecommunications, insurance, utilities, and other bill-pay environments.

“For some consumers, credit scores accurately predict the level of risk for opening an account. But for many, there is more to the story than the credit score,” says Mark Wallin, division manager of First Data’s TeleCheck. “First Data’s Confidence Score solution leverages TeleCheck’s extensive check writer and financial institution database in conjunction with our proprietary risk and fraud detection analytics to paint a picture of consumers’ financial management beyond the credit arena. Clients are then able to accept and perhaps build solid relationships with qualified applicants they might otherwise have turned down, while minimizing their risk of charge-offs.”

With First Data Confidence Score, each new account applicant is screened and assigned a score between 1 and 999. Clients can use the score and the accompanying information, including additional reason codes, to gain a deeper understanding of an applicant’s financial history and the factors that impacted scoring. With this insight, banks and credit unions can more effectively evaluate individual financial risk to make better account acquisition decisions.

Financial institutions can use the information to segment checking account customers for product and account privileges that align with their risk profile. For example, banks and credit unions might choose not to offer a debit card or overdraft protection, or apply check writing limitations. They also might choose to flag accounts that require closer monitoring.

First Data’s Confidence Score solution allows clients to use multiple forms of identification to screen applicants. The solution leverages TeleCheck which provides affordable, real-time information based on checking account history at TeleCheck merchants and financial institutions nationwide. The information includes extensive financial data, that identifies applicants with a history of account abuse and poor maintenance, charge-offs, and fraudulent checks.

First Data Confidence Score joins an existing First Data suite of DDA lifecycle management solutions, including First Data New Account Screening, which indicates a consumer’s debt status with TeleCheck; and DDA Collections Services, a specialized pre- and post-charge off collections service for DDA debt.

 

 

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