Margin test

Customer needs have changed dramatically over the course of the pandemic, and as some parts of the world begin to move back into what we recognize as normality, the scale of change across today’s credit landscape is now emerging. New research from Experian’s Global Decisioning Report shows how the impact of payment assistance programs, coupled with changes in spending and savings behaviors, now requires lenders to look beyond traditional approaches to decisioning. Our research found that 1 out of 3 consumers remain concerned about their finances. However, at the same time the research also found that consumers are no longer reducing their discretionary spending as much as they were six months ago, with high-income households starting to spend the most.  These differences make it difficult for lenders to truly comprehend customer needs throughout this abnormal time. This report reveals three things lenders should do to navigate the complexity of the current lending and credit environment: Leverage data and advanced analytics – this will ensure lenders have a comprehensive understanding of the risk and opportunity of their portfolio as well as visibility into changes to customer profiles.  Proactively engage customers – offer new credit and other products to support those that are recovered and ready to engage. Prepare for a potential wave of delinquency – as payment holidays come to an end, lenders should make it easy for customers that are still struggling. Lenders must offer online support and flexible terms that help customers solve their problems.   The online customer experience and credit risk management are more connected than ever before. Lenders need to make sure they have the technology in place that supports the entire customer journey, from decisioning, to onboarding, to customer management and collections. Those that do will be able to deliver credit decisions that are fair and fast, giving more consumers access to the credit they deserve.  Experian surveyed nearly 9,000 consumers and 2,700 businesses from around the globe to learn more about how they’re stabilizing their finances and returning to growth. Download a copy of the eBook here.

In most parts of the U.S., the start of summer marked the lifting of many pandemic led restrictions. Capacity limits, mask mandates and social distancing requirements are being removed and many of us are spending more time doing the things we enjoyed prior to the onslaught of COVID-19. There is no question the pandemic created serious financial challenges for millions of Americans, yet many people found opportunity to improve their financial standing. Fewer options for travel, dining and entertainment reduced costs, while the government stimulus packages helped maintain or increased available funds. Personal savings surged, and lower credit card balances and fewer missed payments spurred an uptick in average credit scores. Sadly, at the same time, many consumers struggled to make ends meet as they faced job loss, illness or cared for ill friends and family. As the world starts to reopen and things begin to feel a bit more normal, many people have questions about how they can improve (or protect their newly improved) credit scores and prepare for a financial healthy summer. One of the best places to start is by checking your credit report. You can get a copy of your Experian credit report and a FICO Score at no cost every 30 days by enrolling in our free service. When you enroll you not only receive a free credit report and score each month, but also have access to other services that can help you protect your financial health, including credit monitoring and alerts and credit card and loan offers that are tailored to you. The belief that checking your own credit report will hurt your credit scores is a common misconception. You should check both your credit report and scores often. You can also get a free credit report from each of the three bureaus once every week at www.annualcreditreport.com through April 2022. In addition to getting your free credit report from Experian, here are five other things you can do to improve or maintain your credit standing this summer: 1. Prepare for big purchases. Regularly checking your credit report and credit scores is always a good idea. This is especially true if your summer plans include applying for new credit cards, auto loans or a mortgage. I recommend getting a copy of your credit report and credit scores three to six months ahead of applying for new credit, especially if it’s a major purchase. Doing so can help you ensure there are no signs of identity theft and that your credit scores are as good as they can be when you apply. Use this link to get a free copy of your Experian credit report with a FICO Score. 2. Have a summer spending plan. After many months spent at home with little to do, it may be hard to avoid the temptation to overspend. It’s great that we can pick up canceled travel plans and get together with friends and family, but don’t try to make up for lost time at the expense of your financial health. Create a budget outlining what you can afford to spend this summer and build your plans from there. Doing so can help you avoid the temptation to overspend and prioritize what’s important to you. 3. Get credit for paying your bills on time. While this summer may be filled with less Netflix binging than last summer, you can still use your on-time bill payments to your advantage. Experian Boost allows you to get credit for paying your streaming service, cell phone, internet, utility bills and other bills on time.   4. Avoid missed payments. Nothing will hurt your credit scores more than missed or late payments. To maintain a positive credit history, make a plan to catch up on any missed payments and contact your lenders if you think you may fall behind. Sometimes summer plans can disrupt routines. Enrolling in autopay can be a helpful way to stay on a payment schedule that works for you.  5. Keep your card balances low. Your utilization rate, or balance-to-limit ratio, is an important factor in determining your credit scores. It is calculated by adding all your credit card balances at any given time and dividing that amount by your total credit limit. Lenders typically like to see ratios of 30% or less, and people with the best credit scores often have very low credit utilization ratios. A low credit utilization ratio tells lenders you haven't maxed out your credit cards and likely know how to manage credit well.  Keep in mind that if you use your credit cards for summer travel plans or vacations and pay your balances down when you return home, you may still see a temporary drop in your credit scores. Your lender reports your account status about once a month, so it could be several weeks before your report is updated. Scores calculated after your report is updated will reflect the paid off amount. Depending on when you made a payment, it could take a full billing cycle before your credit report is updated and your credit score reflects those changes. Remember, credit can be a financial tool, but debt is a financial problem. If you’re looking for more resources on credit education, head to the Ask Experian blog or join us for an upcoming Credit Chat every Wednesday at 3 p.m. EST on Twitter. Until then, I hope you have a happy, safe and financially healthy summer.

We aspire to be one of the best companies in the world to work for – a diverse, equitable and inclusive workplace that our people feel proud to be part of. We have over 17,800 people in 44 countries, 94 different nationalities and an age profile that spans 5 generations. With such a broad, multi-cultural environment, we want everyone to feel supported, included and able to grow and succeed. Today we have published our first Global Diversity, Equity and Inclusion (DEI) Report, an opportunity for us to reinforce our commitment to making Experian a place where everyone can be themselves at work – and to map the progress we are making on improving our diversity as a business. The events of the past year have shown the uneven impact of the global pandemic on certain communities. It has also demonstrated how important it is for our people to feel safe, secure, and connected to one another. This has strengthened our determination to continue building our ‘people first’ culture to be even better than it is today. We have taken the opportunity to stand back and evaluate our work on DEI, and this year we will focus on five priority areas which include, assigning executive level sponsors; developing a better data set to understand our demographics; reviewing our hiring practices both internally and externally; increasing transparency and accountability; and empowering our people to help us create a more diverse and inclusive business. We have also set specific diversity, equity and inclusion targets to hold ourselves accountable and to monitor our progress. We know there’s always more work to do, but the steps we are taking are the right ones to move us forward. We have big ambitions as a company and achieving these rely on us having the widest range of talent possible. We know that If we continue to live up to our purpose and stay true to our diversity, equity and inclusion ambitions, we will make Experian a better and stronger company in the process. Read the full Global Diversity, Equity and Inclusion (DEI) Report here. Jacky Simmonds is Experian’s Chief People Officer.

We sit in a pivotal position in the societies where we operate. For us, using our expertise in data to help tackle big societal issues, is much more than an opportunity. It’s a responsibility that we take very seriously. And we are passionate about creating a dynamic and diverse workplace. We want to be one of the best companies in the world to work for, a business that our employees are proud to be part of, where people of all backgrounds have equal opportunities to grow and succeed. That’s why this year we are announcing the publication of two new global reports, recognising our commitment to diversity, inclusion and sustainability. The launch of our first Global Diversity, Equity and Inclusion Report highlights our dedicated focus on creating an environment where people of all backgrounds have equal opportunities to grow and succeed. The publication of this new report is a step forward for us in increasing transparency around our progress and goals. As part of this, we are announcing our new target of increasing the number of women in the senior leadership team to 40% by 2024. Our commitment to sustainable business practice is also stronger than ever. This year’s Sustainable Business Report sets a number of goals to help us create a better tomorrow for everyone. Including reaching 100m people through our social innovation products by 2025 (from 2013) and that by 2030 we will cut our scope 1 and 2 emissions by 50% and our scope 3 emissions by 15% – recognising the urgent need for more businesses to accelerate their response to climate change. You can read more about the work we are doing in the full reports here: Global Diversity, Equity and Inclusion Report Sustainable Business Report

We recently wrapped up a special community outreach effort during Financial Literacy Month that reflects something important to Experian – helping consumers, especially underserved populations, understand credit and how to harness it to their benefit. It’s important to rally around a cause like this at peak times throughout the year, but financial literacy and, more importantly, financial power for all is what drives us every day, every month and every year. Empowering consumers is the fuel behind our innovation and the portfolio of credit tools we have developed in the past few years and those to come. While there are different viewpoints around the use of credit scores to assess consumers’ credit-worthiness, credit bureau data remains the most effective means for understanding a consumer’s financial situation. This is why we continually innovate to find new ways of utilizing that data to give consumers more control and allow lenders to see well-rounded consumer profiles. Our charter led to the launch of the first-of-its-kind tool, Experian Boost. By allowing consumers the ability to directly add positive payment history for recurring utility and telecom bills – even video streaming services – to their Experian credit report, they can take a proactive step to improve their credit score and gain more control. While lenders benefit by seeing additional data about consumers that considers positive behavior for paying these types of recurring bills that hasn’t been factored in the past. It’s a win-win situation, and we’ve seen the positive results. To date, Experian Boost users have gained access to more than 1.7 billion total dollars in credit as a result of improving their credit scores, while 1 million consumers added a credit card in the first year after the launch. Also, nearly 250,000 consumers acquired an auto loan and some consumers earned a credit score for the first time. For those who had thin files and weren’t able to enter the credit ecosystem before, obtaining a credit score for the first time and learning how to improve it can be life changing. Our mission is to drive financial inclusion and facilitate access to fair and affordable credit for consumers; that objective is not just on our minds during one particular month out of the year. Experian Boost was a lengthy initiative in the making, and we believe one big step in the right direction to achieve our objective. It won’t stop there. I’m looking forward to more innovation to come that continues to assist consumers in gaining more credit knowledge and control over their credit in order to reach their financial goals.