New feature: credit score reasons
Credit score can be hard for borrowers to understand. And it’s a complex three-digit number that can also baffle loan officers.
That’s why NestEgg is launching a new feature: credit score reasons. These are shown next to the credit score, in our decision engine. Explaining the factors that might be driving a credit score down, this helps Loans Officers better understand an important indicator of risk.
Of course, there’s more much to making fair loan decisions than a three-digit number. Because of this, NestEgg uses financial health indicators as the basis for credit assessment.
Nevertheless, credit score is widely recognised, if misunderstood. It is also widely used, if sometimes unfairly. But credit score often determines how much interest a borrower pays for a loan. Whilst there are open banking alternatives, they are far from widely used. Nor are they trusted or understood, and people don’t feel engaged.
Because of this, improving a credit score remains important. It means cheaper goods and services.
The NestEgg app provides over 200 credit score alerts to users with tips and advice on how to improve. Credit score reasons are mapped back to the decision engine to give a unique shared view of financial health. Consequently a lender and borrower both know what needs to be done to be accepted for a loan, reducing lending risk in the process.
This is one of a number of upgrades to our decision engine. And there are many more to come, including the provision of demographic data on borrowers, improved open banking information, better decisioning for revolving credit and more integrations with core systems.