Risk Management

Different types and offerings of credit bureaus

Credit bureaus see new ways to use products to complement existing products and services. Trans Union is promoting the use its Horizon bankruptcy-scoring system with its Empirica default-scoring model. It focuses on account 90 days or more behind due. Powers states that customers can use Horizon with Empirica to focus on both general delinquencies and bankruptcies simultaneously. “We believe it is time to examine both.” They are launching more than just sophisticated scoring models. However, this trend is supported by the development of strategies to also provide database marketing services.

Equifax has Credit Bureaus

Equifax has recently left the insurance-services industry to focus on financial services. It has also acquired additional card authorization and processing operations, as well as entered into alliances in target marketing and credit bureau reporting. Equifax’s Decisions Solutions unit is responsible for many of the company’s new products, including models, risk scoring and bankruptcy predictions. Thomas F. Chapman is the Equifax chief executive. He says, “We’ve chosen to move from a credit bureau into a multifaceted global company.” Equifax has acquired 50 companies over the years and now operates in 40 countries. It also derives approximately 25% of its revenue outside the United States. The company has reorganized to offer risk management products, ranging from prescreening tools, collections-scoring, and customer-service models.

Alliances of Credit Bureaus

HNC Software Inc. and VNU Marketing and Information Services have formed new alliances to help Equifax position itself as a provider for high-end, comprehensive credit reporting services. Equifax has partnered with HNC to integrate the neural-network technology of HNC for finding patterns within data pools, as well as its own risk management and card-processing systems. VNU Marketing signed an agreement to co-develop analytical and marketing tools. This agreement was made in conjunction with VNU’s purchase of Equifax National Decision Systems last year. National Decision Systems products can still be accessed through a link to Equifax’s World Wide Web website. It offers a wide range of marketing tools including 65 databases that allow you to sort data in different categories such as demographics, consumer spending and business operations.

Credit Bureaus: Electronic Payment Software

Equifax Card Solutions is an electronic-payments software developer, formerly known under the name First Bankcard Systems or FBS. It is currently developing enhancements to its software that allows card issuing, collection, and merchant processing in credit agencies. Equifax recently announced its plans to increase Card Solutions’ product range through the planned purchase of Hahira (Ga.)-based Goldleaf Technologies Inc.

Card Solutions, a relational database software, will allow cardholders to be separated by their demographic information in a future system. The company claims that the ability to identify cardholder purchases on a “plastic–byplastic” basis will make it easier for merchants and credit card companies to use this information to market to cardholders.

Card Solutions by Credit Bureaus

Card Solutions is also developing transaction-level pricing. This permits you to process credit cards transactions differently for different types, including separate major-purchase balances and deferred payments. It also allows you to calculate deferred interest and calculate deferred interest. Equifax claims that customers will eventually be able define different authorization options for each transaction.

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