Overview
Analyzing risks

Payment Instrument (PI) Risk Score identifies good and bad borrowers, as well as the compliance risks associated with processing payments.

This non-credentialed service analyzes thousands of attributes to enhance the financial profile of the consumer, helping to mitigate fraud, reduce defaults and reduce returns. The attributes evaluated include transactions, behaviors, and characteristics associated with debit cards, pre-paid cards, credit cards, bank accounts, contributory databases, payment platforms, and payment processors.

This score can be used as is or combined with any of our other services to complete the consumer’s financial profile, access greater actionable insights and enhance predictive power.

Overview
Analyzing risks

Payment Instrument Risk Score identifies good and bad borrowers, as well as the compliance risks associated with processing payments.

This non-credentialed service analyzes thousands of attributes to enhance the financial profile of the consumer, helping to mitigate fraud, reduce defaults and reduce returns. The attributes evaluated include transactions, behaviors, and characteristics associated with debit cards, pre-paid cards, credit cards, bank accounts, contributory databases, payment platforms, and payment processors.

This score can be used as is or combined with any of our other services to complete the consumer’s financial profile, access greater actionable insights and enhance predictive power.

Use Case Solutions

What is a Payment Instrument Score?

What the Payment Instrument (PI) Risk Score means?

The PI Risk Score is a number that predicts the likelihood that a consumer will pay their bill on time, payback a loan, or other credit obligations, in a timely fashion.  The higher the score, the lower the risk. Using a mathematical algorithm, the PI Risk Score looks at a consumer’s credit activities and behaviors, account length and history, new account creation velocity, payment instrument transaction history, and the characteristics of the financial institutions issuing the accounts.

The PI Risk Score does not look at the total or type of debt a consumer has, nor does the PI Risk Score look at whether there was a bankruptcy, lien, judgement, or foreclosure. The more recent, frequent, and severe the negative items are, the bigger the impact on the overall PI Risk Score. The PI Risk Score number helps you more accurately understand credit risk.

How is the PI Risk Score determined?

The score is calculated from the data in a consumer bank account, debit card, and contributory databases made of financial institutions and thousands of retail merchants. The PI Risk Score considers information about types of accounts, account balance histories, account statuses, transaction patterns, and other factors.

The payment instrument score ranges from 600 – 1400. Unlike traditional credit scores that rely on merchant account history, the PI Risk Score only requires your applicant to have a bank account.

Why Does the PI Risk Matter?

The PI Risk Score makes the credit decision process faster, more fair, and enables you to provide alternative credit choices to compete for the consumers business.

The PI Risk Score is calculated in real time and because it relies on live account status information from banks and financial institutions, you get a result that is reflective of the consumer at the time you make the request.  This differs from scores you obtain elsewhere that may have been calculated at a past time, or is using information from a credit bureau, or even a different score model.

Because we incorporate the status of the payment instrument into the PI Risk Score, it can also be used to validate the bank account and card information.

Make more well-informed credit granting decisions, streamline the application process and apply the same standards for all borrowers.

Case Study
Consumer lender finds an additional 7% of applicants to originate.

A consumer lender under pressure to grow their portfolio consulted with ValidiFI’s Data Science team. The PI Risk Score was able to identify declined and rejected applicants to have the same default risk as their approved and originated customer pool.  The lender aligned the PI Risk Score to its models and launched a new initiative, that increased good originations by more than 7%.

The addition of the PI Risk Score enabled the lender to scale with resiliency, and represented a significant growth opportunity.

Case Study
Consumer lender finds an additional 7% of applicants to originate.

A consumer lender under pressure to grow their portfolio consulted with ValidiFI’s Data Science team. The PI Risk Score was able to identify declined and rejected applicants to have the same default risk as their approved and originated customer pool.  The lender aligned the PI Risk Score to its models and launched a new initiative, that increased good originations by more than 7%.

The addition of the PI Risk Score enabled the lender to scale with resiliency, and represented a significant growth opportunity.