FICO pilot holds promise for auto financing, from Automotive News.
The results of a pilot program between Fair Isaac Corp. and 12 big credit-card companies could ultimately help dealerships get auto loans approved for so-called thin files — that is, customers with little or no credit history.
Fair Isaac, better known as FICO, is testing credit scores generated by “non-traditional” payment histories, such as paying cellphone and utility bills, which historically didn’t show up in credit scores.
FICO says the new credit scores, using data from LexisNexis and Equifax, could potentially provide credit scores for 15 million thin files.
Jeff Scott, a spokesman for FICO, told Automotive News the new scores could provide an “on ramp” to credit. The potential benefits to auto lenders and dealerships are probably down the road, he said.