TransUnion launches new credit scoring solution for the card invisibles
CAPE TOWN - TRANSUNION Africa has launched a new credit scoring solution called CreditVision Link that could result in millions of previously “credit invisible” and “thin file” South Africans gaining access to credit.
TransUnion estimates nearly 26 percent of adults are not able to access credit because they never built a credit history by leveraging a financial product, a statement said yesterday.
Consumers who don’t have a credit history often don’t qualify for credit, and CreditVision Link uses alternative data to help lenders better evaluate consumer risk for financial products such as clothing accounts, credit cards, loans and mortgages.
“It will help consumers build financial security by getting access to responsible credit, while giving credit providers deeper insights into the risk behaviour of previously invisible and thin file segments of the population,” TransUnion Africa CreditVision product manager, Christelle Rall said.
TransUnion’s latest Financial Hardship report, which measures the impact of Covid-19 on consumers, found 82 percent of South Africans were financially impacted by the pandemic.
Only 12 percent said their household finances were as planned in 2020, while 69 percent said their finances were worse than planned.
“Access to credit is fundamental to a growing economy, and too many South Africans are credit invisible,” said Rall.
“Based on our initial validations, CreditVision Link would be able to accurately score as many as an additional 8 million South Africans, who otherwise would be returned as no-hit or thin file by traditional models and be excluded,” said Rall.
One way CreditVision Link analyses consumers is by examining data such as property information, commercial links, family construct, and where they live.