MADISON, Wis. The Filene Research Institute with Del Norte CU and Dupaco Community CU launched a new competition this afternoon among 20 Visa cardholders to study the trajectory of a credit score with a six-month race to see who can improve their FICO score the most.
The Great Credit Race will follow the use of a Visa credit card by 20 individuals who have no established FICO score (or a zero score) for six months to ascertain key variables that affect the score’s opening growth.
Participants in the study each receive a Visa credit card with a $500 limit and are only told they must make monthly payments in a timely manner and cannot exceed the set limit. On the last day of each month, each credit union will do a soft pull of the credit score via TransUnion. On the 180th day of the race, the individual with the highest score will be deemed the winner and receive $500.
As part of Filene’s i3 innovation program, two member credit unions will pilot the study in an effort to crack the code on how credit scores experience an uptick from score inception: Del Norte CU, Los Alamos, N.M., and Dupaco Community CU, Dubuque, Iowa.
Other i3 credit unions contributing to the project are: Elevations CU, Leaders CU, Xceed Financial CU, and VanCity CU of Canada.
The i3 program has introduced such innovations to credit unions as prized-based savings and matrimonial accounts.
“The insight gleaned from this study may give consumers a real step up in the credit game, helping them establish habits that will open the doors to better opportunities and lives,” said George Hofheimer. Filene’s chief research + innovation officer.
The great conundrum is that it’s really hard to get credit if you have no credit score,” said Hofheimer “Since considerable weight is put on revolving credit for credit score determination, the Great Credit Race has made the use of a credit card the crux of the investigation.
“Unveiling some of the initial triggers, both positive and negative, on a credit score could be groundbreaking for consumers who struggle with home and car ownership, rental ability, and even job acquisition," he said.
