The FICO score is a 3-digit number between 300-850 that ranks consumers according to their credit risk, with higher scores indicating lower risk of default. Over 100 billion FICO scores have been sold and power over 10 billion lending decisions annually. To generate a FICO score, a consumer must have at least one open account that has been reported to credit bureaus within the last 6 months and not be deceased. FICO scores are used in 90% of US lending decisions and consider factors consumers can review and correct to determine creditworthiness in a fair and transparent manner.

1. The Origin and
Evolution of the FICO
Score
Anthony Sprauve, FICO
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2. What is the FICO® Score?
• It’s a summary of a consumer’s credit file.
• A single 3-digit number ranging from 300-850
which rank orders consumers according to
risk.
• Higher scores equate to lower future risk of
default.

4. FICO® Scores – Expertise
• Over 100 billion FICO® Scores have been sold to date
• Powers 10 billion+ lending decisions a year
• 70,000+ businesses rely on FICO® Scores worldwide
• FICO® Scores enhance decision-making
– Across lenders of all credit industries
– Across various decision points -- approval/denial, marketing and portfolio management

5. FICO® Score Models in Place at All Major
U.S. and Canada Credit Reporting Agencies

6. The Relationship “Connection”
Consumers Credit
Grantors

8. FICO ® Score Distribution

9. Who Doesn’t Have a FICO ® Score?
• 200 million adults in the United States have a FICO ® Score
• To generate a FICO ® Score three things must be present (minimum
scoring criteria):
– Not deceased
– One account must have been opened for at least six months
– One undisputed account must have been updated by the credit bureau within
the last six months
• Data not currently found in credit bureau reports is being studied to
determine if it is predictive of a consumer’s likelihood to repay a
debt
– Property records
– Utility bill payment information

10. FICO ® Score vs. educational credit scores
• FICO ® Score used in 90 percent of lending decisions in the United
States
• Educational scores sold to consumers are not used in making lending
decisions
• myFICO.com was created to educate people about the differences
between the FICO ® Score and educational scores
• myFICO.com is the only place consumers can purchase their FICO ®
Score

11. What Makes a Good Credit Score?
• Provide equal opportunity by scoring at least 200 million
Americans
• Ensure fairness by complying with all appropriate government
regulations
• Empower consumers by utilizing only data they can review,
challenge and correct
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12. What Makes a Good Credit Score?
• Protect the safety and soundness of lending decisions by using a
scientifically valid, peer-reviewed scoring system
• Promote transparency via public resources that explain how the
score is computed along with guidance for improving a score
• Create financial opportunity for everyone with an algorithm that
is not affected by a consumer's educational or employment
background
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13. Thank You
©2013 appbackr inc. confidential and proprietary.