How three top lenders gained more customers while minimizing risk

Mike Mondelli
Blog Post06/03/2016

In the current landscape of steep competition and regulation, lenders are challenged with acquiring more customers while maintaining or improving current risk levels. Sound familiar?

Many lenders are in the same situation. Their existing scoring methods usually only employ traditional credit bureau data, but that’s not enough. Credit bureau data alone limits your ability to approve certain loans and encourages would-be customers to shop competitors with better lending terms.

Furthermore, you need to be cognizant of the regulatory environment. Expanding your universe of qualified borrowers requires proven effective tools that also meet your compliance standards.

It may sound like a big investment in time and resources—but it doesn’t have to be. 

Three top ten lenders solved this common problem and successfully achieved average portfolio size increases of up to 25% while minimizing risk. What’s more, they were able to implement their chosen solution within a couple of months, with limited coding required of their IT teams, and they did not have to compromise their compliance strategy. Further, they achieved up to 10X ROI with a hybrid approach.

How did they do it? With a hybrid approach to risk assessment:

  1. First, they analyzed applicants who were previously declined or unfunded by their respective institution but were funded by competitors
  2. Next, they added TransUnion’s CreditVision® LinkSM, which combines trended credit and alternative data, to the traditional credit bureau data they were already using
  3. Finally, they used the more precise score to identify swap-in opportunities which led to improved portfolio health

Learn how each lender  increased their portfolio size

Context matters. 
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