Credit score maker Fico eyes bigger share in India’s consumption story
- India is uniquely positioned because everyone has a bank account and that is a big opportunity, says Fico CEO Will Lansing
Mumbai: US-based analytics company FICO, the maker of FICO credit score used by lenders to assess credit worthiness of borrowers, sees business opportunities in the upbeat consumption potential of the Indian economy, chief executive officer Will Lansing said in an interview
Founded in 1956, the company uses predictive analytics, artificial intelligence (AI) and data science to improve operational decisions of businesses, primarily in the financial services space. On Tuesday, FICO launched its cloud-based platform in India with lenders like HDFC Bank, Axis Bank and AU Small Finance Bank, being the early users.
“We are in a moment in time when the Indian economy is poised to spring with consumer consumption and credit, unsecured lending, all of which are to happen in a significant way.” Lansing said the platform was built over a decade ago and has been sold to 100 of the top 300 global financial institutions. He said the data used by the platform will reside in India.
While the FICO score is also available in India apart from other markets, it is not big here since it is built on credit card payment data and India does not have significant credit card penetration. India had 95 million credit cards at the end of October, as per data from the Reserve Bank of India. “India has very low credit card penetration, sub-100 million cards, and so we do not have the credit card payment data like most other countries and that is what we build our score on,” he said.
However, the software platform takes into account all kinds of data that’s predictive of good behaviour, he said. These include rental payment data, utility payment data, income coming into bank accounts, besides others, and Lansing said all of that can predict whether an individual is a good credit or bad. “India is uniquely positioned because everyone has a bank account and that is a big opportunity,” said Lansing.
Lansing said FICO has been in India for 20 years and has employees in Bengaluru who do research and development (R&D) work. In fact, the FICO Platform was largely built in India. The company has about 1,300 employees in India and a majority of them are in the R&D division in Bengaluru.
“I was with a CEO yesterday who said in order to grow the Indian economy at 7%, we need consumer credit to grow at over 20% and the only way you can really do that is with some technology around lending. We are here because the market is big and excellent and we know how to help,” he said.
Asked about concerns surrounding a section of retail borrowers getting overleveraged, Lansing said it is an issue not just in India but in the US too. “The government is very focused there as it is here on not getting consumers overextended and not having them borrowing money that they cannot afford to repay,” he said.
Catch all the Business News , Corporate news , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
MoreLess
First Published:6 Dec 2023, 12:30 AM IST
- Top Gainers
- Top Losers
- 52 Week High