New webcasts focus on credit score model conversion and implementation

New webcasts focus on credit score model conversion and implementation

Date: June 24, 2020

Earlier this month, VantageScore Solutions launched the first in a series of webcasts designed to help consumer lending institutions convert from an incumbent credit scoring model to one that provides better performance. The series will cover the process of comparing a new model’s effectiveness to that of an older one, the steps involved in implementing and optimizing a new model, and how to best integrate a new model with institutional lending and risk-management goals.

“These webcasts are an extension of the dialogue we’ve been having with lending institutions since the launch of VantageScore 3.0,” said Sarah Davies, senior vice president of analytics, research and product management at VantageScore Solutions. “In a post-recession lending environment, institutions are seeking tools such as VantageScore 3.0 that are designed to deliver maximum benefit given the current credit dynamics.”

The webcasts leverage the knowledge and experience of more than 25 industry experts who have deployed new credit scoring models in their strategies, processes and technology platforms at major lending institutions.

The first webcast details key analytic process and reporting building blocks for approaching credit score model conversion. It also provides a checklist of tasks that should be completed in order to successfully implement a new scoring model with the goal of reducing losses and increasing volumes. The webcast outlines four methods for implementing a new scoring model, and provides in-depth guidance on one conversion method, dubbed “plug and play.” Sufficient for many institutions, the plug-and-play method also can serve as a first step in the more sophisticated conversion techniques that will be detailed in future installments in the series.

A companion webcast covers credit score migration trends and the continued evolution of consumer credit management behaviors with an emphasis on how credit providers can leverage those trends.

Future webcasts in the series will be posted on a regular basis. Each installment builds on prior information to address credit score model conversion approaches for increasingly complex strategies and product designs. Broad topic areas will include testing (including back testing, phased implementation and champion-challenger approaches); new strategy design for universe expansion opportunities; and performance monitoring methods.

More specific subjects to be covered include:

  • Understanding the risk versus volume trade-offs when setting the score cutoffs using a new scoring model. Analyzing and capturing swap set financial and behavior dynamics in order to optimize the score cutoff.
  • Origination trends over the recession. A study across the mortgage, auto and credit card industries that examines how origination trends changed and what geographic opportunities exist for portfolio growth.
  • Optimizing score cutoffs in complex lending strategies using multiple scoring models and/or additional lending criteria. Many lending institutions incorporate additional underwriting criteria to further segment consumer populations. A future webcast will take these criteria under consideration and provide guidance on how to analyze, test and monitor scoring model conversion scenarios.
  • Full strategy rebuild. A comprehensive discussion of analytics and processes to guide lenders in universe expansion strategy design that captures the value of new consumers without introducing undue risk.

To receive alerts when these and more VantageScore Solutions webcasts become available, follow the VantageScore Twitter account (@VantageScore), contact one of the three national credit reporting companies (Equifax, Experian and TransUnion), or subscribe to our YouTube channel.