TransUnion has introduced a new credit score simulator tool to CreditView; its white-labelled, interactive solution which provides consumers with access to their credit report and score and helps finance providers improve customer engagement and brand loyalty.
The new credit score simulator can support UK consumers in managing their finances, by giving them the power to proactively test the impact of future financial decisions on their credit score and help enable more informed decision making.
Score simulator will be available via finance providers that offer CreditView features to their customers. Users will be able to choose from multiple scenarios – such as adding a new credit card, taking out a loan or mortgage, amending credit limits and adding missed payments – to test the impact on their credit score.
Kelli Fielding, managing director of consumer interactive at TransUnion in the UK said: “The new CreditView score simulator works by generating hundreds of possible credit score combinations, giving consumers the ability to better understand how future choices may affect their creditworthiness, without affecting their existing credit score. “In the current climate, it’s more important than ever that people take control of their credit report and score and protect their financial standing as much as possible. Missed payments, for example, will be likely to have a negative impact that could affect future borrowing, so consumers need to understand the implications of their choices.”
According to TransUnion’s research, UK consumers are showing a keen awareness of the importance of their credit scores – with 59% saying it was important to monitor credit during the ongoing pandemici. The same study showed that those struggling to pay bills are seeking flexibility in existing credit facilities, rather than taking on new ones – so consumers are thinking of making a partial payment, taking advantage of a payment holiday, using a balance transfer or refinancing existing loans, all before taking out a new loan or credit card. Score simulator allows consumers to test the impact of different options.
The CreditView web-based dashboard, which can also be made available via API in the lender’s own app or website, enables finance providers to offer their customers ongoing visibility of their credit report and score. It includes daily alerts to provide early warning of changes to their credit profile – a useful tool for fraud monitoring – and month-on-month score comparisons to help consumers manage their credit.
TransUnion’s score simulator is already used in other regions globally including the US, Canada and India, with analysis showing that nearly half (49%) of consumers who simulate a loan will take one out within 42 days of the simulationii.
Kelli Fielding continues: “Our Consumer Credit 2020 white paper, published earlier this yeariii highlighted the important role of credit. At that time, 41% of UK consumers said they struggled to manage financially when they had been rejected for credit. Since then, COVID-19 has had a huge impact on people’s finances, with three out of five householdsiv having been negatively affected. Given these circumstances, it’s vital for finance providers to help consumers understand the different financial options and the potential impact on their credit profile.”
Find out more about TransUnion’s credit score simulator here.
TransUnion’s Financial Hardship Study, survey of 1,007 UK adults carried out 4 – 5 May 2020
TransUnion analysis of credit monitoring population, 1/1/18-3/31/18
iii. Consumer Credit 2020: Access to finance in a changing market
TransUnion’s Financial Hardship Study, based on surveys conducted from 23 March to 5 May 2020
Source: TransUnion UK Press Release