By SubPrime Auto Finance News StaffCOSTA MESA, Calif. –
Another initiative to help finance companies cater to consumers with little or no credit backgrounds recently surfaced; this time from Experian.
In what the company said is meant to further financial inclusion across the United States, Experian launched what it dubbed Experian Go, a free program to help “credit invisibles,” or people with no credit history, begin building credit “on their own terms.”
The company explained through a news release that Experian Go is the only program currently available that can help consumers establish their financial identity by creating an Experian credit report.
According to Experian, nearly 50 million consumers have a nonexistent or limited credit history. Without an existing credit report, Experian said finance companies can’t verify a consumer’s identity and consumers are unable to access credit at fair and affordable rates.
“Often, these consumers are caught in cycles of predatory lending; can’t cover emergency expenses; and face limited housing options, higher insurance premiums and interest rates, employment challenges, larger deposit requirements and more,” Experian said.
The company indicated that Experian Go, which began piloting in October, has already helped more than 15,000 credit invisible consumers establish an Experian credit report and become visible to potential finance companies and other lenders.
By helping consumers establish a financial identity through Experian Go, Experian aims to help consumers build the foundation for future financial opportunities.
“Living with a nonexistent or limited credit history can be a significant barrier to financial opportunity in America,” said Craig Boundy, chief executive officer of Experian North America. “We believe every individual deserves the opportunity to reach their fullest financial potential and we’re proud to be the only credit bureau with a program to help credit invisibles build their credit history in minutes.
“Innovations like Experian Boost and Experian Go help to ensure people can access the credit they need when they need it. This new program is a direct reflection of our mission to bring financial power to all,” Boundy continued in the news release.
As Boundy referenced, the launch of Experian Go is a continuation of Experian’s mission to help consumers everywhere get access to fair and affordable credit.
Within minutes, the company said credit invisibles can have an authenticated Experian credit report, tradelines and a credit history by using Experian Boost and instant access to financial offers through Experian Go.
Experian noted that this program can help consumers build credit and become scoreable without going into debt. In fact, Experian said its early analysis shows 91% of consumers with no credit history who connect to Experian Boost, a free feature that allows users to contribute their on-time cell phone, video streaming service, internet, and utility payments directly to their Experian credit report, can become scoreable in minutes with an average starting near-prime FICO Score of 665.
Once a consumer downloads Experian’s free mobile app and enrolls in a free Experian membership, they’ll be asked to authenticate their identity using a government-issued ID, Social Security Number and a “selfie.”
From there, personalized recommendations are available to help users add accounts, also known as tradelines, to their Experian credit report.
Users may receive information about becoming an authorized user or be invited to apply for a credit card designed specifically for those new to credit. Others may contribute their on-time bill payments directly to their Experian credit report with Experian Boost, a feature that’s helped nearly 9 million consumers instantly improve their FICO Score.
Since launching in 2019, the company said Experian Boost has helped more than 10,000 previously unscorable consumers receive a FICO Score each month and added more than 78 million points to FICO Scores nationwide.
According to other Experian research, 28 million consumers are credit invisible and an additional 21 million consumers have “unscorable” credit files, meaning they have what’s considered a thin credit file or limited credit history.
Experian acknowledged the problem more frequently impacts communities of color. In fact, a recent Experian survey revealed one in five Black consumers and one-third of Hispanic consumers don’t have any credit in their name, with 65% of Black consumers and 51% of Hispanic consumers unsure of the steps to take to establish or improve their credit.
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