Equifax and FICO credit score creator Fair Isaac are partnering to offer banks access to more consumer data.
The companies started pitching each other’s services earlier this month and announced their partnership Wednesday, according to The Wall Street Journal. Now, they will promote one another’s offerings and sometimes approach clients together.
Equifax provides data reporting on a consumer’s credit history and status, including things like income, bank account balances and utility bill payments.
FICO offers software that helps banks analyze loan applicants to determine suitability.
The partnership is an effort to expand the depth and reach of consumer credit reporting.
From the WSJ:
“For decades, most U.S. lenders have reviewed loan applicants’ reports and scores to determine whether to approve them and what interest rate to charge. After years of relatively cautious lending, banks and other lenders are seeking additional consumer data to help them make loans to more borrowers, including people with little credit history or with blemishes. Credit-reporting and -scoring firms have been pivoting to address the demand.”
The WSJ said the deal was was organized by the companies’ CEOs, FICO CEO Will Lansing and Equifax CEO Mark Begor, who have known each other for decades. Begor was also a FICO board member until he joined Equifax last year.
The two companies assert that combining their services will enhance underwriting decisions for banks, especially when assessing applicants with minimal credit histories. But some banks and fintech firms complete their own such reporting in-house, which will be competition for the new partners.