FICO has introduced FICO Score 4 and FICO Extended Score 4 in Mexico. The product is available now, according to a press release.
“FICO® Score 4 and FICO® Extended Score 4 will help leaders identify opportunities for growth in their customer base, accurately manage organizational risk tolerance, increase profitability and reduce losses, by bringing insights available from Círculo de Crédito to bear on credit risk decisions,” the press release states.
In light of the launch, the global analytics company has entered a partnership with Círculo de Crédito to redevelop the FICO Score using machine learning modeling techniques to tend to trends noted in consumer data, and help clients predict consumer credit risk.
“In partnership with Círculo de Crédito, we are proudly bringing the dependability and industry-leading predictive power of the new FICO® Score 4 Suite to Mexico to expand access to credit in the region,” Head of Latin America Global Partners & Alliances at FICO, Pablo Morales, said in the release. “This is the culmination of continuous work with our partners to innovate using the latest, most robust data science, and sophisticated artificial intelligence and machine learning model development techniques. Our new models broaden financial inclusion by an additional 8 million scorable consumers in Mexico by leveraging new consumer credit information.”
According to the press release, the new score models are intended to facilitate an entire credit file to better serve Mexico’s dense population, with the most recent version of the product surpassing the potential of previous versions with an 8.5% predictive lift and while FICO Extended Score 4 provides up to 18% predictive lift over previous versions.
“This new version is an enhancement to the previous scores as the innovative analytic methodologies used by FICO aim to provide strong performance, better financial inclusion, an empirically derived score and better customer segmentation capabilities,” the press release states.
FICO score initially launched in Mexico in 2014. Círculo de Crédito has reported more than 200 million FICO Scores, including 30 million FICO Extended Scores. The Mexican agency’s recent growth has benefited FICO Score in the country as a growing number of retailers, insurance companies and financial institutions use the product for credit cards, auto loans, personal loans and mortgages.
According to a research model pieced together by FICO for one large Mexican lender, FICO Score 4 has the capability to increase profit by up to 86% and reduce delinquency by 13% and maintain current acceptance rates.
“Our goal at Círculo de Crédito is to generate credit conditions that promote financial well-being and trust between consumers and the industry, building better relations between credit providers and their beneficiaries, while helping companies and individuals better understand the information that will allow them to meet their economic and financial goals,” said Juan Manuel Ruiz Palmieri, CEO of Círculo de Crédito, in a press release. “Through our partnership with FICO, FICO® Score 4 Suite has been developed and tested using our most recent data to address issues specific to regional lending practices, current consumer behaviors and today’s credit environment to drive a responsible credit culture in the market.”