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Experian has launched the Experian Bankruptcy Score, the UK's first widely
available predictor of personal bankruptcy.
The scorecard enables lenders to predict with greater accuracy the likelihood of
an individual consumer declaring themselves bankrupt within the next 12 months,
enabling lenders to identify which of their existing customers are likely to
declare themselves bankrupt within the next year, even though they may still be
keeping up with all their credit repayments at the time.
Simon Harben, Senior Vice President of Global Analytics at Experian-Scorex
commented: "The continuing rise in UK consumer bankruptcies has made it more
important than ever for lenders to be able to identify and react to the early
signs of potential bankruptcy amongst their existing customers.
“It is generally acknowledged that highly credit active 25-45 year olds living
in rented accommodation are the group with the highest risk of personal
bankruptcy.
"Our new Bankruptcy Scorecard identifies this group by analysing more than 20
different factors to identify high-risk cases.
“This new, pre-emptive score will provide lenders with an early warning of
serious debt problems to come, and a number of major UK lenders are already
investigating how best to incorporate the Bankruptcy Score into their existing
customer management strategies."
The new Bankruptcy Score is designed to be used in combination with Experian's
behavioural bureau credit score, Delphi for Customer Management.
Used together on a lender’s up-to-date existing customers, these two scores have
proved to not only identify around 50% more bankrupts, but also to identify an
extra 15% of the defaults within this group.
Source:
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