CRIF Develops New Bureau Score for Mexico’s Buró de Crédito
Mexico City (April 12, 2018) –CRIF S.A. de C.V. has developed Score Buró No Hit for Mexico’s Buró de Crédito. The new bureau score facilitates access to credit products for consumers who are not able to be scored by the typical bureau score due to the lack of sufficient credit history.
The new score is particularly important for young people just starting activity in the credit market or people who previously didn’t need or couldn’t afford any credit products. In this way, Score Buró No Hit will contribute to Mexico’s growing economy by providing a strong capability of credit expansion to the financial sector while also bringing high credit standards with financial stability.
For about 20% of customers that are present in the BC database and have tradeline history, a valid BC Score will not be returned but only an exclusion score indicating that the customer doesn’t meet minimum scoring criteria. There exists an additional large population of customers registered on BC databases but without any tradelines or are not registered at all. This part of clientele is known as the No Hit population.
As a result of marketplace demands, CRIF has developed the BC No Hit Score, a model that will help financial institutions more effectively manage portfolios for populations with limited or no credit history. It is the first scoring system exclusively developed for Mexican credit risk prediction for the no hit population using Mexican credit bureau information from Buró de Crédito. BC No Hit Score is a credit risk prediction product complementing the BC Score. BC Score would be calculated whenever the necessary amount of payment history allows it. BC No Hit Score will fill the requisite market gap for when the BC Score can’t be computed.
A number of public external sources containing data regarding territories’ demographic structure, economic activity and development, public safety, social cohesion and development, credit access and usage were consulted and explored. Based on them series of territorial indicators were built. These indicators were used as possible predictors of the individual credit risk behavior. They allow exploring what the relation between characteristics of a geographical area and individual’s risk is.
The following external data sources were used:
• INEGI – Census Data - Censo de Población y Vivienda 2010
• INEGI – Census Data - Encuesta Intercensal 2015
• PNUD – Human Development Index 2010
• CONEVAL – Indicadores de pobreza, pobreza por ingresos y gini 2010
• CONEVAL – Social Cohesion 2010
• CONEVAL – Índice de Rezago Social (IRS) 2015
• Fuero Común – Crime Data – Incidencia Delictiva 2015
• INEGI – Economic Activity And Public Security Data 2000-2010
• CNBV – The National Survey of Financial Inclusion (ENIF) September 2015
• INEGI – Niveles Socio Económicos (NSE) 2000
• Correos De Mexico – Postal code Catalogue 2016
CRIF has presented the BC No Hit Score at the BC Forum in September 2017 and will be further supporting BC in the monitoring and validation of the solution in the forthcoming years. The product itself was presented to the credit market by Buró de Crédito representatives in a private event last April 12, 2018, as they currently commercialize the BC Score, they will also be responsible for providing this new score to the financial entities.
With the industry’s most trusted analytics solutions like the BC hit and no hit scores, CRIF is committed to creating value, supporting better business performance and helping consumers to better manage credit health. CRIF uses experience with Mexican, U.S. and international risk management, credit scoring and decision management analytics and data aggregation to create solutions that transform analytics from a costly ad-hoc project to an affordable business process.
About CRIF LAC
It provides credit management solutions for Mexico and Latin America, as well as expert software solutions and advanced analytics that help to make decision-making processes more efficient. CRIF has a physical presence in its offices located in Mexico City, from where all projects are coordinated with our current clients and potential prospects. Our services have reached a level of specialization in credit products for both regulated and unregulated financial institutions, as well as niche finance in industries such as retail and automotive financing.