Nordigen outperforms a major credit bureau in Spain

New hope for credit modelling teams everywhere

We recently carried out a proof of concept for a client in Spain, where the task at hand was to help the client evaluate the probability of default of customers using account information. In essence, this means turning account statements into risk scores.

The results were stunning — not only our scores proved to be very predictive, but we outperformed a major credit bureau by 12% measuring GINI coefficient.

Here is an illustration of the results:

“Benchmark scores” included client's proprietary data and features; “Credit Bureau” included a set of variables related to credit history; “Nordigen” included variables generated from account information.

Key takeaways

The clear advantage of account data is information about income and spending behaviours of private individuals and this information cannot be found in any traditional credit reports. On top of this, account data includes information about active liabilities — for example, monthly regular payments to a lending institution can be used as a proxy for an active loan. This is particularly useful in countries, where credit bureaus don't have a positive register.

That being said, there are two key takeaways from the test:

1. account data and credit bureau data capture different behaviours and the best results are achieved when both data sources are combined;
2. scores generated from account information can be more predictive than credit bureau data.

Have you tested account data in credit scoring models before?
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About Nordigen
Nordigen is a global account data analytics solution helping banks and lenders improve the speed and accuracy of their credit decisions. Supported across 17 countries.
www.nordigen.com

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