The perfect credit card owner

Financial organizations which only are entering into the retail market and not having databases of borrowers, developers offer so-called scoring cards which contain the average data about the solvent borrower. But such card is only a starting point in construction of qualitive scoring. At occurrence of the credit stories the bank together with the developer improves this card. Many domestic financial organizations have rushed aggressively to win the market of consumer crediting, having only scoring cards. Such policy has led to a considerable quantity of bad loans. But, according to bankers, it is a natural entrance fee on the market. Having obtained the data on non-returns financial institutes can eliminate better borrowers.

To renew scoring cards and cards of foreign banks the time is necessary. Experts consider that is because of high economic dynamics of weight of various parameters of the borrower. A problem with entering and adjustment of qualitive scoring systems also depends on having good specialists on modeling of financial risks. Therefore retail banks often engage the former employees of the western financial organizations.

The price of scoring consists of a payment for the license (annual — in a case with the foreign companies and disposable if it is a question of domestic companies) on the software and costs of its introduction (disposable payment). The license price depends on the size of the bank determined by quantity of clients: the more there are clients the higher is deduction. To small financial organization the license can manage in 57 thousand dollars, large — in five-seven times more expensive. Development and entering of scoring decisions costs from 50 thousand to three millions dollars. General investments into the software necessary for mass issue of retail credits can constitute from 7-10 million dollars.

In consumer loan cost (reaches 50–100 % annual) the margin for risk constitutes 10–12 %. It means that in process of enhancement of techniques of risks assessment credits will become cheaper. Specialists consider that scoring card is all the same much better than the usual card. So, in one of domestic banks use of scoring cards has helped to lower level of defaults for seven percent. However that scoring systems have earned really effectively, it is necessary for financial organizations to communicate. While domestic creditors don’t aspire to participate in bureau of credit stories. Thus, they not only protect themselves from an unfair competition, but also considerably narrow possibilities on counteraction to swindlers. From statistics it is known that the better is model the more supervision it is needed for construction.

Researching correlations only on the basis of the credit stories, banks will receive the big errors. A problem of domestic organizations and that they don’t use behavioral and collecting scoring, limited application scoring and also don’t consider in the models regional features of borrowers. So level of non-returns under retail credits will decrease only when information interchange about credit stories will begin.

Can you remember those good times when everybody could take a credit if one required money? And just imagine the situation of those who have to carry that burden nowadays when the economy is facing hard times. And for those people having loans the issue of credit monitoring is as urgent now as never before. It is not only about loan monitoring, this also helps save money, time, and nerves and be quick in solving loan related problems. Those who are searching for a place where to find out about credit report with score, are invited to check out this credit report monitoring site – there is much information about credit monitoring and how to order the service.

In addition we haven’t forget about possibilities provided to us by digital technologies. The online network gives a truly unique chance to find what we need or to obtain anything on the best terms which are available on the market.