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State employee credit union takes up scoring system from Fair Isaac

Fair Isaac : 19 January, 2009  (Application Story)
FICO credit rating system to be made available to employees of Pennsylvania state in bid to provide better management of borrowing
Fair Isaac has announced an agreement with the Pennsylvania State Employees Credit Union (PSECU) to provide its online checking customers with free FICO Scores. The FICO Score is used to help make billions of credit decisions each year, including more than 75 percent of US mortgage loan originations.

Fair Isaac's agreement with PSECU marks the expansion of the FICO Scores On Statements program, which has been a successful customer loyalty initiative with one of the nation's leading consumer banks for the past six years. PSECU members are eligible to participate in PSECU's FICO Score Service and receive their free FICO Score each month if they have online banking through psecu@home, the credit union's online account access program, and a checking or credit product from PSECU.

"The Fair Isaac Scores on Statements program not only benefits our members by giving them a free view into their financial health, but it also helps PSECU by educating our members on the positive impact of responsible credit behaviors," said Gregory Smith, President and CEO of the Pennsylvania State Employees Credit Union. "This ultimately results in a higher value member base, fully engaged online with us."

Scores On Statements authorises lenders to give free FICO Scores to their customers through online consumer accounts, along with educational information to help them better manage their credit rating. Customers also gain access to fee-based online products from myFICO for score monitoring and related activities. The Scores On Statements program gives lenders an opportunity to increase their customers' account activity and usage of the lender's website, while deepening customer loyalty and generating an additional source of revenue. Any cost to lenders can be minimised by licensing the same FICO Scores that the lender already orders and uses each month in its account management activities. Arrangements also are available for lenders who want to provide the scores to their customers who have direct deposit accounts.

"Scores On Statements provides such good benefits to bank customers, we want to extend the opportunity to more lenders," said Shon Dellinger, vice president of myFICO for Fair Isaac. "It's a great win-win opportunity for Pennsylvania State Employees Credit Union and its members, especially given the current economic climate. PSECU members feel respected and appreciated by their lender and enjoy having free online access to the same FICO Scores the credit union uses. By knowing and understanding their FICO Scores, consumers can gain important insights for managing their credit and, in the process, become better borrowers and savvier users of credit."

The agreement between Fair Isaac and PSECU makes an estimated 200,000 members eligible to receive free access to their FICO scores. Scores On Statements is currently available to a total of 1.5 million consumers nationwide.

"Financial Institutions have a decided need to engage consumers online with high value personal finance tools," said Bobbie Britting, Research Director in the Consumer Lending practice at TowerGroup. "Given consumers' heightened concern to know and understand their credit score and situation, the Fair Isaac Scores on Statements program offers clear benefits by creating customer loyalty to online banking, inspiring good credit behaviors, and providing a platform to promote other automated banking services. This leads to a more profitable customer base for banks by making use of lower support costs, and greater product and service cross-sell with wider adoption of their online products."

Online banking users can check their free FICO Score through their password-protected online statement. Features available to users include:

* The account holder's FICO Score accompanied by the top credit factors contributing to that score.
* Score tracking for up to twelve months to help the account holder monitor changes.
* Educational information to help account holders understand and manage their FICO Scores over time.
* Link to myFICO website for exploring FICO Score-based credit management products and services.

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