Test Latest Posts

When it comes to credit for small businesses, it’s a classic chicken-and-egg situation: you can’t get credit until you have credit history, and you can’t get credit history until someone grants you credit. I know this first-hand because my own parents were small-business owners in California. My parents had built an independent insurance agency. I distinctly remember as a kid sitting in the backseat of our car and overhearing the discussions they would have about their struggles to grow the business or how they would make payroll that month. Many small businesses don’t have access to small-business loans or business credit cards, so they rely entirely on the business owner’s personal credit to make purchases. This means that while there may be a credit history for the individual, there is none for the business itself. This also means that whenever my parents needed money to get through the month, they essentially had to put their livelihood at risk because there was no separation between personal and business loans. The lack of access to funds, and the consolidation happening in the insurance industry at the time, led my parents to take another big risk – they sold the business and our house, and they liquidated their retirement accounts and put everything into a restaurant franchise. They felt there would be more stability representing an established brand owned by someone else. When I graduated from my MBA program years later, one of the things that first attracted me to Experian was the opportunity I had to ease the burdens of small business owners through my work here. The work I do really hits home, because I’m working every day to open up small-business credit, using different types of data. In today’s economy, a lot of great business ideas – profitable ones, at that – never get a chance to see the light of day simply because they don’t have the capital they need to grow. Experian is making business ideas a reality by gathering, analysing, combining and processing a breadth of new data that allows us to develop credit scores for more people and paint the most realistic picture of a situation. By verifying a business’s history, its social media accounts, its website sophistication and traffic, and customer reviews, we can measure a small business’s legitimacy, how long they’ve been operating and how they’re growing. This information, coupled with transaction data, all help determine a business’s credit worthiness and allow us to give its owners greater access to capital. Data is a huge enabler for positive change because it can give small-business owners access to credit that they wouldn’t receive otherwise. When used in the right ways, data can empower and enable small businesses to get the funding they need to hire employees, invest in their business or open a new location. In many ways, I’m helping people just like my parents.

April = Tax season. For some people, it is a dreaded time of year when they have to comb through file after file to make sure every financial document is accounted for. It can be a sore reminder that the previous New Year’s resolution of being organized may have failed. With your taxes filed (hopefully you didn’t have to extend), you may have the motivation to get your financial documents back in order and do some spring cleaning. What better time than now, during Financial Literacy Month. This month is dedicated to highlighting the importance of financial literacy and teaching Americans how to establish and maintain healthy financial habits. Every week Experian discusses financial behavior topics on Twitter and Periscope Join the @Experian_US #CreditChat every Wednesday at 3 pm Eastern time It is the perfect time to take a step back to evaluate your financial standing. Especially if you were in a situation where you were scrounging up funds to pay Uncle Sam. Do you need to adjust your budget or even create one? Do you know how to budget? If you were one of the lucky ones who expects a refund, do you feel confident in making the best financial decision on what to do with it? There are lots of resources to help guide you and answer your questions. Take advantage of those resources! To give you a jumpstart, Rod Griffin, Experian’s director of public education, has the following tips to help you improve your credit history: Review your credit report regularly —Your personal credit report is an easy-to-read record of your credit accounts and total indebtedness. Be sure to obtain a copy of your credit report once every 12 months (and especially before major purchases) and dispute any information you believe is inaccurate. You can request a copy of your report directly from Experian or once every year from Annual Credit Report. Check your credit score —Credit scores can play an important role in your financial journey. They translate the information in your credit report into a number reflecting the risk of doing business with you. To check your risk, request a credit score when you order your credit report. You will receive an explanation of what the score means and which details from your credit report are most affecting it. Keep your utilization rate low —Your utilization rate, or balance-to-limit ratio, should never exceed 30 percent of the credit limit. Your total credit card balances should never be more than 30 percent of your total credit card limits, and you don’t want any one card to have a balance of more than 30 percent of its limit. Both can hurt you. Remember, 30 percent isn’t a goal; it’s the maximum your balances should ever be. The lower your utilization rate, the better. If you have missed payments, get current and stay current —Late payments, called delinquencies, may have a major negative impact on credit scores. To see the fastest improvement in your scores, catch up on late payments and pay down your balances. Late payments are the most important indicator of credit risk, so they have the greatest and longest-lasting impact. The more recently the missed payment occurred, the greater that impact will be, and the more missed payments you have, the longer it will take to recover. If you fall behind on your payments, contact your lenders to see if they can improve the terms of your debts. Need answers to your credit questions?

About a year ago, my colleague Natalia invited me to join her in a new volunteer opportunity with the Ministry of Housing in Colombia. The Ministry had created a new program called Mi Casa Ya – which means in English “My Own Home Now,” to help people in Colombia own their first homes. Excited and eager to lend a hand, Natalia and I introduced ourselves to Alejandro, the Director of the National Housing Fund at the Ministry of Housing. Alejandro told us how an unexpected roadblock threatened to derail the program. He had created Mi Casa Ya so that even the poorest people in the country could get a government subsidy to purchase a home. To get the subsidy, they just needed to qualify for a mortgage from a local bank. But that was the problem. In order to get the bank loan, applicants needed a strong credit history. Yet most of the people looking to take advantage of the subsidy through Mi Casa Ya, he explained, were considered “credit invisible.” That is, they had no viable credit history, thin or un-scoreable credit files, or they simply had bad credit. So banks had no choice but to reject them. Natalia and I heard the frustration in Alejandro’s voice, and we knew just how we could help. We told Alejandro that if the Ministry could determine which individuals were being rejected by the banks, we could come in and build credit scores for them using Experian’s data. You see, building credit histories is the sort of thing we do every day at Experian. Over the years, Experian has innovated with analyzing traditional and alternative data sources, such as public records and magazine subscriptions, to create the most accurate and realistic picture of someone’s credit. And by unlocking the power of this data, we are able to identify the data sets that can help lenders make better decisions when making loans, especially for people with thin credit files. Working with Natalia and Alejandro for Mi Casa Ya over the past year has been incredibly rewarding – and our work here isn’t done! Since I work in the legal department at Experian, I am now involved in reaching an agreement with the Ministry of Housing to help advance this project. The details are tricky and the process is tedious, but when I think about the people whose lives we have the ability to transform, I just get excited. Because of our work, many more families in Colombia will be able to fulfill their dream of owning their own homes – that’s huge.

Growing up my dream home included a white picket fence, black shutters, a red door and an amazing backyard. Admittedly, my dream house was an exact replica of the house in the “Father of the Bride” movie. Parked in its long driveway was that brand new car. Fast forward 20 years later, I’m now a young adult uncovering the realities of adulthood and the financial behaviors it takes to attain those dreams. The question that comes to my mind frequently in the midst of financial decisions, is why am I just learning about all of this now? "We take the responsibility of educating people very seriously to help them feel confident in their decision-making. The only way to accomplish that is to ensure that effective financial education is provided throughout a person's life." – Rod Griffin, Experian director of public education Unfortunately, courses in personal finance were not part of our curriculum in school. In fact, I’m not the only one who second guesses money matters. Multiple studies have shown that consumers lack the confidence in their personal finance knowledge they need to make effective, fiscally wise decisions. A study from Mintel finds that just 19 percent of respondents give themselves an “A” grade on financial knowledge. According to the National Foundation for Credit Counseling’s 2016 Consumer Financial Literacy Survey, 45 percent of adults gave themselves grades C, D or F in rating their personal finance knowledge. Those statistics are exactly why Experian celebrates Financial Literacy Month #FLM2017 each year and why we are so heavily invested in enriching financial education in America — all year round. We want financial literacy, but more importantly, we want people to reach financial capability. It's the reason we have a dedicated public education team to educate consumers and empower clients to provide proper credit education to their customers. It’s also the reason why we financially support nonprofits that share our mission of strengthening financial education and helping individuals make better financial decisions. Our products and services can give consumers confidence in their financial decisions to get access to financial services so they too can purchase their dream house or car. Every week Experian discusses financial behavior topics on Twitter and Periscope Join the @Experian_US #CreditChat every Wednesday at 3 pm Eastern time Learning how to become financially literate takes time and something I've faced as larger life moments enter my view. I encourage others to take the time to talk about their own money matters and to take advantage of resources to improve your own financial literacy and well-being too. To learn more, see all of our activities for Financial Literacy Month.

By volunteering through Experian’s Sohos Reais – Real Dreams – project, I taught a mother of five about understanding basic business concepts so she could expand her sewing business and keep pursuing her dream. I grew up with parents who loved helping others, which fostered my love for volunteerism. Now that I work at Experian, this passion has blossomed as I’ve volunteered in many different capacities, from dressing as a clown to cheer up people in hospitals, to helping teach financial literacy to small-business owners in São Paulo, Brazil. Experian’s Sohos Reais – Real Dreams – program is designed to help connect entrepreneurs and small-business owners with experts who can advise them on how to help their business succeed. My volunteer partner, Diana, and I went through the training together, and a few months later were contacted by Aliança Empreendedora – Experian’s project partner – to help support a local entrepreneur. We were sent information about a woman named Adriana who was looking for advice for her sewing business. When we first met at Adriana’s house, she welcomed us into her home, fed us toast and black coffee, and introduced us to her five children. Adriana is a single mom whose husband left her after becoming a drug dealer. She told us how he had stopped supporting her and the children financially, and how Adriana now relied on her sewing business to support herself and the children – two of whom had serious health issues. Creating this business had been her dream since she was 12, when she had made her first dress for a school party. Now, she sewed colorful shopping bags and purses every day that she sold for R$1.25 a piece – a tiny price compared with the amount of work it took her to produce them. While she loved her job, Adriana told us that the money she made from her sales barely allowed her to cover basic living expenses, like water and electricity. She was on the brink of giving up her dream. The more we talked with Adriana, the more Diana and I realized that what she needed most was someone to help her understand basic business concepts, like cost and revenue. I thought that if we could help her control the money going out, we could solve a lot of her problems. Adriana was eager to learn, so right then and there, I showed her how, by keeping track of costs and profits, she could pay her bills and start to save money for her family. After our first meeting, a group of us from Experian were so inspired by her story that we raised R$1,415 for Adriana to buy fabric for her bags, and gave her a book to help her track her finances. Now every time we meet, Adriana brings the book with her, full of notes – she says it helps her work out her profit from the bags she sells so she knows how much more fabric she can buy. I never imagined that just sharing my financial knowledge with someone could help change their life. By volunteering with Real Dreams, Diana and I helped Adriana get back on her feet and continue pursuing her dream as a small-business owner and provider for her family.  

I recently attended a conference in Alwar, India, hosted by Experian and the International Finance Corporation. During one of the sessions, I met a single mother of two who had recently moved to a rural village in India. Her husband had left her and she was hoping to pick up work as a tailor once she purchased a sewing machine to support her family. As we talked, she confided in me that she was having trouble securing a loan from microfinance institutions because she didn’t have papers to prove her identity. And since she was new to the village, no one knew who she was. Without a proven identity, she couldn’t qualify for a loan and get the money she needed to support herself and feed her children. Indian banks predominantly serve urban customers whose credit reports are extensive. However, most customers from smaller districts and rural towns – like this woman – can fit their credit history on less than a page. Identification may be the only way they can verify their character to secure a loan. As I sat with this woman, I started telling her about our Prove ID tool that I had recently helped to develop. Using an individual’s biometrics, the tool would search her credit history, bank card and any information that can prove she is who she claimed to be. I explained that by using this tool, she could now prove what village she’s from, that she was a permanent resident in her new village and that she was likely to repay her loan. She was stunned and overwhelmed. In that moment, I realized that rural clients often need human connection to clearly understand what a bank or microfinance institution requires in order to obtain a loan. Many rural customers can’t read the brochures or pamphlets sitting in a bank, but by engaging them in conversation, you can effectively educate them about how to prove their identities and build their credit profiles to successfully access the finances they need. As a Product Developer for banks, I sometimes get so caught up on how to make products run that I lose sight of how the work I do impacts the community. Helping one woman discover Prove-ID to secure a loan and provide for her family inspired me. I want to continue being more involved in my community to help others who may not be literate learn how to prove their identities so they can better support their families.