Trended Data – Minimize Risk and Head-Off Default

February 15, 2017 Theresa Freas

Today’s static consumer credit profile provides a limited understanding of financial behaviors and risk profiles. Delivering a more dynamic view of consumers, trended data helps you see the trajectory of spending and repayment behaviors by analyzing consumers’ financial behaviors over a set period of time. Compared to the static snapshot view you get from a traditional credit profile, trended data can help you refine and monitor your underwriting and modeling strategies. Trended data can also help you identify prospects that fit your ideal risk profile.

Incorporating trended data into risk decisioning can help you more actively monitor your portfolio. Understanding the trajectory of credit behavior, you can readily identify customers who may be likely to default, and proactively work with those customers to ensure timely repayment of credit. Trended data also may help you understand the ‘breaking point’ where a customer will likely default. Determining likelihood to repay of accounts already in default can also help you prioritize debt collection activity. Trended data can also help you determine future bankruptcy potential, helping you avoid further loss through early detection.

Monitoring consumer credit over time can also alert you to abnormal spending patterns, an indicator of potential fraud. Is your customer opening several accounts in a short period of time? Could you be looking at potential bust-out fraud? Trended data can help you proactively detect such patterns in account opening, helping you head-off fraudulent activity. Incorporating trended data into your daily activities may help to streamline and automate labor-intensive manual review processes, saving you time and money.

To learn how Equifax can help you minimize risk and head-off default, visit our website at http://www.equifax.com/business/trended-data. You might also explore our previous posts on Trended Data by visiting our blog.

 

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