Banks and Credit Unions Usher in Era of Personal Financial Empowerment as Consumer Credit Scores Become Even More Accessible
New Javelin study commissioned by TransUnion finds most consumers are accessing credit scores on at least a monthly basis
More than half of U.S. consumers view their credit score at least monthly, with 87% receiving such updates at no cost. A recent study from Javelin Strategy & Research commissioned by TransUnion (NYSE: TRU) found that the majority of these consumers review their credit data through free services provided by their banks or credit unions, a practice that has ushered in an era of personal financial empowerment.
The positive impact viewing one’s credit score has on overall financial health is real. The Javelin study found that 71% of consumers who check their scores at least once a month perceive that they have control over their day-to-day finances, compared with the roughly 54% of consumers who never check their score.
In an effort to empower their customers to take more control of their credit, banks, credit unions and other organizations have been offering their customers access to white labeled versions of TransUnion’s CreditView Dashboard®. The dashboard is often used as an engagement, retention and marketing tool to provide customers with educational content and access to their personal credit information.
Proprietary TransUnion data confirms the assertion that checking one’s credit score can lead to more positive credit behavior. Nearly one in five consumers (19%) who enrolled and utilized the CreditView Dashboard at least once saw their scores improve 40+ points during 2018. This is compared with 13% of consumers of those same financial institutions that offer CreditView Dashboard, but do not take advantage of it.
Furthermore, more than one-third of subprime consumers (34%) who monitored their credit between March 2018 and March 2019 were able to increase their credit score to a near prime or above credit risk tier. This percentage dropped nearly in half to 18% for those consumers who did not monitor their credit in the same timeframe.
The Javelin study found that consumers who check their credit scores monthly express more confidence that they:
- Maintain control over their financial lives
- Could absorb a financial shock
- Will achieve the financial freedom necessary to enjoy life
- Are on track to meet long-term financial goals
- Can set aside money regularly to pay large periodic bills
Additionally, the study determined that more than half of consumers using a credit monitoring service say they do so to remain vigilant and protect themselves against identity fraud.
Nearly half (48%) of consumers with prime credit scores check their credit data to see where they stand vs. 21% of consumers in the subprime population. That said, 19% of consumers with subprime scores access their data before applying for loans compared to just 7% for prime. Similarly, 16% of subprime consumers access this information to rebuild their credit versus just 6% for prime.
Source: TransUnion Press Release