FICO® Resilience Index

A new analytic tool to help capture consumer credit risk linked to unexpected economic stress
More precisely predict a borrower’s resilience to potential future economic disruptions

The FICO® Resilience Index is designed to rank-order consumers with respect to their resilience or sensitivity to an economic downturn.

It answers questions like, “Which ‘680s’ are more likely to go bad when financial stress is exerted on a consumer population?” giving lenders a new tool to use and helping avoid taking large measures that impact more “resilient” consumers unnecessarily.

Why Use FICO Resilience Index Indicator?

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Better Prepare for Downturn Cycles
Access insights into consumer resilience under economic stress, and manage and reduce financial volatility.
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Accurately Assess Loan Portfolio Vulnerability
Gain an additional way to evaluate the quality and resiliency of portfolios at any point in an economic cycle.
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Refine Credit Marketing and Origination
Modify your marketing strategies and offer more favorable terms to attract consumers resilient to financial stress.
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Improve Stress Testing Outcomes
Improve capital coverage in stress test scenarios required for regulatory stress tests such as CCAR and DFAST.
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Better Estimate Loss Allowances
Help identify hidden risks within lending portfolios, providing a basis for adjusting future loss estimates under a range of economic scenarios.
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Integrate Easily with Existing FICO Score Processes
FICO Resilience Index is available for use in conjunction with the FICO Score and can be pulled simultaneously as a simple extension to existing batch and online processes.
Better decisioning and portfolio management

FICO® Resilience Index can be used by lenders as another input in credit decisions and account strategies across the credit lifecycle. It can be delivered with a credit file, just like a FICO Score.

It’s scaled from 1 to 99, with higher values representing higher sensitivity to financial stress. It is delivered with up to five reason codes that help lenders better understand the output as well as support adverse action communication, if necessary.

FICO Resilience Index may be used in conjunction with a FICO score or to generate an adjusted FICO Score with factors tuned to lender’s view of economic forecasts.

Building resilience today for tomorrow’s economic uncertainty
Lenders can get started by validating the performance of FICO Resilience Index for a portfolio active or originated during the Great Recession. With data in-hand, showing that the indicator will predict differentiation in future recessions, financial institutions can begin to prepare for financial instability.
To speak with an Equifax team member about FICO Resilience Index, contact us today.

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