The FLEX Connexion Blog

Wonder Twin Powers of Credit Scoring

Written by Preston Packer | Feb 20, 2020

 

Meet twin brothers Ron and Don. Ron drives a new Porsche, spends his weekends at the country club and his vacations in Aruba. Don is sporting his 6th year in his Honda minivan, lives in a modest colonial, and is saving up for a national-park vacation. On the surface, Ron may appear more successful, but any credit union executive with access to credit scores on the pair would find that Don actually has a greater wealth potential allowing him to qualify for better interest rates on loans or credit cards. Appearances can be deceiving, but data doesn't lie.

Credit unions should have all the information they need to effectively market to their members. Data from their core data processor can tell you what the spending habits of members are, what loans they have maturing, what rates they currently pay or possibly qualify for on loans, what funds they have saved, and much more. Knowing a member's FICO® Score may also allow credit unions to market to members in a very personalized manner.

In marketing terminology, a customer engagement score is a single number that is used to measure how engaged your members are. Each member has their own score based on activity and usage of your product and services. The higher the score, the healthier and happier the member is with your credit union. 

Similarly, in financial terminology, a FICO® Score is a 3-digit number that is used to measure how financially healthy a member is. Each member has their own score based on how timely they are with credit card and loan payments, whether they consistently make payments and if their credit balances are excessive or within their means. The higher the number, the healthier the member is financially.

Knowing credit score information about your members can trigger some creative, and potentially lucrative, marketing opportunities. You can gauge not only when a new car would be in someone's near future, but also what type of loan they would potentially qualify for. You can target creative lending offers or balance transfer offers to members whose scores indicate they may need them. You can proactively offer education and guidance to members who may be struggling to establish their credit.

So before your next marketing push, consider incorporating your findings from your members' FICO® Score. That personalized touch can make all the difference in connecting with them on a personal level, showing them you truly understand their needs.