Experian launches new credit score system for consumers with little or no credit history

Posted by Joe on March 11th, 2008

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Experian announced a new credit scoring product today that will help the nearly 73 million Americans with little or no credit history be more fully considered by potential lenders. The new “Emerging Credit Score” takes into account both Experian’s traditional credit scoring data as well as more “non-traditional” data, such as consumer purchase and payment history, sourced from Experian’s partner, eBureau.

According to Experian Senior Vice President Zaydoon Munir:

“Our goal has always been twofold: to help underbanked consumers get the credit and affordable financial services they deserve and to provide our clients that serve these consumers with the best risk-management tools. Utilizing this groundbreaking new scoring method, lenders can now effectively — and equitably — lend to this population and grow their customer base.”

This means that the many millions of consumers with limited credit history may have an easier time qualifying for loans and other credit products from lenders that utilize the new Experian score. Hopefully this will help prevent the traditional catch 22 that many folks with limited credit history feel when they find that they can’t get credit from lenders because they have a no credit history but they can’t develop a positive credit history because no creditors will extend them credit.

However, this also means that it is more important than ever for consumers to practice responsible financial habits across the board because this new scoring system will take into account many new variables that have not traditionally been evaluated by lenders.

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