An Introduction to One Score
What is One Score?
One Score is a new consumer credit score provided by leading credit score bureau, Equifax.
This new score provides lenders with a higher level of consumer credit risk prediction than CCR, enabling lenders to have a better picture of who they are lending to.
How is it calculated?
With One Score, credit history is evaluated using a rich collection of data. While data collected is entirely dependent on the individual, data sources may include:
- Comprehensive Credit Reporting data
- Up to two (2) years of Repayment History Information (RHI)
- Negative data coverage, including enquiries, defaults and public records
- Information from alternative data sources including Buy Now Pay Later services
- Information from geodemographic data sets to more accurately predict risk outcomes
Why has Equifax released a new credit score?
Equifax designed the new system to give a more accurate picture of a borrower’s creditworthiness in the current age, accounting for new consumer behaviours that weren’t relevant until recently. By reflecting these modern behaviours, lenders get a more accurate and relevant picture of their potential borrowers.
What does One Score mean for lenders and brokers?
Lenders and brokers will benefit from the increased accuracy One Score provides. In some case, this may allow the lender to increase the size of an approved loan and improve the alignment between price and overall risk. In addition the one score should allow lenders to expand the borrower population eligible for credit. In short lenders can approve more customers.
When will Plenti switch over to using One Score, and what support is offered?
Plenti personal loans will be assessed using One Score starting Tuesday, the 3rd of May, 2022. In the near future, we’ll be holding a training session with Equifax to give our broker partners the opportunity to learn more about the score model and ask questions. In addition, our BDMs, RMs and broker support members are trained in One Score and are prepared to answer any questions.
Will Plenti still use Comprehensive Credit Reporting?
Yes, auto loan applications will still be assessed based on CCR scores until further notice.