[IMGCAP(1)]
Eight of the top 10 credit card issuers use the credit-scoring model VantageScore Solutions LCC launched three years ago, according to the company.
VantageScore, which was developed to compete with Fair Isaac Corp.'s FICO score, is a joint offering by credit bureaus Equifax Inc., Experian PLC and TransUnion LLC, and is designed to reduce inconsistency among credit scores by using more-similar criteria.
Unlike existing models that often cease measuring borrowers' files after six months of inactivity, VantageScore takes in two years' worth of consumer borrowing and repayment behavior, according to the company. It also registers thin-file activity among new borrowers.
Stamford, Conn.-based VantageScore did not say which issuers use its model, noting they are not likely using it exclusively or at the expense of any others. But while the adoption curve for new scoring models is slow because of the need to analyze them over many months, the economic downturn seems to have spurred more adoption this year, according to VantageScore CEO Barrett Burns.
"VantageScore was developed between 2003 and 2005, when issuers were scoring a wider variety of prospective borrowers than ever, which laid a foundation for scoring more-diverse consumers during economically volatile periods," Burns tells Collections & Credit Risk sister publication CardLine.
