As community banks look for an edge in their ongoing battle for customers, most can tout one basic advantage they have over big banks: they do not do credit scoring.

Credit scoring started as a smart way of cutting down on the cost of putting loans on the books. If a bank could develop a profile of experience that would indicate whether a borrower was likely to pay back the loan or not, it would be able to apply these patterns to new loan requests and avoid the tedious job of individual credit evaluation on each application.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.