Perhaps the auto-finance applicant who arrives through a dealership website portal and eventually lands in your company’s underwriting department might have a more robust file, thanks to enhanced efforts from Experian.
As part of its global commitment to financial inclusion and literacy, Experian this week launched Boost America, a marketing and social media campaign that includes a collaboration to promote credit management with award-winning actor, author and philanthropist Hill Harper.
Experian’s goal is to inspire and empower the more than 100 million thin-file (four or less trade lines) consumers in the United States who may not have access to quality credit to try Experian Boost, what the bureau said is a free online financial tool that can allow consumers to add positive payment history from utility and telecommunications accounts directly into their Experian credit file for an opportunity to increase their credit scores instantly.
“At Experian, our fundamental mission is to help consumers establish their creditworthiness. This is critical, because a subprime credit score will cost the average U.S. consumer approximately $200,000 more throughout the course of their life,” said Jeff Softley, president of direct to consumer at Experian Consumer Services.
“We believe partnering with Hill Harper, such a respected activist, will help us reach consumers across the country with credit education in a way that inspires Americans to want to better manage their credit profile,” Softley continued in a news release.
Harper, currently playing Dr. Marcus Andrews on the ABC drama “The Good Doctor,” is known for his activism promoting financial literacy and his bestselling financial books including “The Wealth Cure: Putting Money in Its Place.” This week, he was in Detroit at his Roasting Plant coffee shop to talk “credit over coffee” with local residents.
Over the next few months, Harper will address credit management via speaking engagements, social media, blog posts and videos.
To follow Harper and be a part of the discussion, go to www.experian.com/boostamerica, and follow hashtag #BoostAmerica. Consumers can also engage with Harper during Experian’s Twitter #CreditChat on May 15 from noon to 1 p.m. PT.
“I’m always excited to empower Americans by helping to increase their financial literacy and, now with this campaign, bring awareness to the importance of credit scores in our lives,” Harper said.
“With more than half of U.S. consumers (56%) having a low credit score, the time is right for an education campaign focused on credit literacy and that shows how tools like Experian Boost can benefit individuals.”
Since the Experian Boost launch in March, results show:
— Cumulatively, more than 3 million points have been added to FICO scores via Experian Boost.
— Nearly two-thirds of consumers who completed the initial Experian Boost process increased their FICO Score.
— Among those who increased their FICO Score, the average score increase has been more than 13 points, and 13% moved up in credit score category.
Back in December, Experian explained how the platform is intended to function.
Through the new tool, consumers can grant permission for Experian Boost to connect to their online bank accounts to identify and access utility and telecommunications payments. After a consumer verifies the data and confirms they want it added to their Experian credit file, an updated FICO score is delivered in real time.
“Globally, we are constantly innovating and leveraging technology to find new ways to help consumers gain access to quality credit, while promoting fair and responsible lending,” Experian Global chief executive officer Brian Cassin in a news release.
“We are committed to financial inclusion, and Experian Boost is the latest example of our efforts to increase consumer awareness of credit’s impact and value while giving them greater control,” Cassin continued.
Experian reiterated consumers with thin credit files (less than five trade lines) and scores between 580 to 669 will benefit the most from Experian Boost.
Experian went on to stress that the potential impact is significant as consumers with low or subprime credit scores often face higher interest rates when trying to gain access to credit.
For example, Experian estimated a consumer with a FICO score of 720 will pay $4,020 less for a $10,000, five-year vehicle retail installment contract — saving $67 a month compared to someone with a score of 500.
“Limited credit activity and history are key barriers for consumers to achieve their financial goals,” Credit Builders Alliance executive director Dara Duguay said. “We fully support initiatives that promote financial inclusion and think Experian Boost could play an important role in overcoming that barrier. We look forward to seeing how Experian’s new platform impacts consumers.”
The bureau added that contributing consumer payment history to an Experian credit file can allow finance companies to make more informed decisions when examining prospective borrowers. Only positive payment histories will be aggregated through the platform and consumers can remove the new data at any time. There is no limit to how many times one can use Experian Boost to contribute new data.
Consumer contributed payment histories will be compiled through Finicity, a provider of real-time financial data aggregation and insights.
“Experian is a true pioneer in giving consumers control that could immediately impact their credit scores,” Cassin said.
“Experian Boost marks our next step in delivering the most innovative and consumer-centric solutions, supporting our mission to be the consumer’s bureau and bringing lenders and borrowers together more efficiently than ever before,” he went on to say.