Using AI to Expand Opportunities for Consumers and Small Businesses

WHETHER IT’S A SMALL RESTAURANT SEEKING CAPITAL TO EXPAND, or a recent college graduate applying for their first credit card, access to affordable financial services products can help drive greater personal financial health and set a path for future generations. Equifax leverages Artificial Intelligence to help solve complex problems and introduce new methods of modeling that can ultimately help create greater financial opportunity for people.

“Our Purpose - to help people live their financial best - is at the heart of everything we do,” said Harald Schneider, Chief Data and Analytics Officer at Equifax. “Our investments in AI and advanced data science enhance the products and services we develop to drive inclusive lending practices and help individuals and businesses take the next step in their financial futures.”

Equifax research in 2023 shows that 76 million Americans have little-to-no credit history. 61 million people have “thin” files, defined as having four credit accounts or fewer and 16 million are “credit invisible” with no documented credit history. While credit reports remain a strong indicator of credit history and past financial reliability, we believe that data not included in traditional credit report data has the potential to help responsibly expand consumer access to credit and support a more inclusive economy. 

Unique alternative data from Equifax - including information such as verified income, telecommunication and utility payment history and cash flow insights - that may not be included in traditional credit reports – makes a difference for millions of people worldwide. Leveraging Equifax Differentiated Data could shift 8.4 million more U.S. consumers into scorable credit bands. 

Our studies also show that incremental populations become scorable when using alternative data and AI. Ultimately, EFX.AI allows us to build insights from significantly greater amounts of our trusted, proprietary, non-public data  – helping lenders, service providers and government agencies make more holistic decisions and open financial opportunities to otherwise underserved populations.

A more comprehensive picture of creditworthiness can also help startups and small businesses access the financing they need to grow operations or navigate headwinds in an uncertain economic environment. This is why we leveraged our patented AI technology to create our proprietary OneScore and OneScore for Commercial credit scoring models to help open up financing opportunities for qualified applicants by providing greater visibility into their financial profiles.

For consumers seeking financial services that include credit cards as well as personal and auto loans, OneScore, powered by advanced analytics and machine learning, combines traditional credit data with telecommunications, pay TV, and utility payments on more than 191 million consumers. OneScore can also incorporate other Equifax data, comprising payday loans, subprime credit cards, specialty loans, as well as rent-to-own and furniture financing data on 80 million consumers, including payment history from nontraditional banks and lenders.

Meanwhile, the OneScore for Commercial credit scoring model utilizes extensive small businesses data including data from the Commercial Financial Network, commercial public records and firmographic data, as well as more non-traditional financial business information, such as telecommunications and utility and leasing payment history. By leveraging these unique data assets, Equifax is able to help provide greater visibility into small businesses in an effort to help them gain access to credit that they may not have previously qualified for.

This is all made possible by the embedded AI capabilities within our proprietary cloud technology. We custom built the Equifax Cloud™ to maintain and manage the large volume of diverse, proprietary datasets needed to maximize AI performance. A central component of the Equifax Cloud is our custom data fabric – an adaptable structure that unifies our differentiated data (from over 100 proprietary, siloed data sources) while also enabling us to manage that data in keeping with regulatory requirements.

For consumers, OneScore, powered by advanced analytics and machine learning, increases the scorable population by more than 32% - or 8.4 million credit-seeking consumers - compared to traditional scoring models.

Our research shows that the OneScore for Commercial has the potential to score up to 50% more applicants, enabling lenders to approve up to 20% more applications while maintaining the same risk profile. This could result in up to 4 million more small businesses gaining access to credit.

To learn more about EFX.AI, please visit Equifax.ai.