FICO and Plaid Add Cash Flow Data to Credit Scores

FICO and Plaid launched a credit score that uses real-time cash flow data.

The new score, an update of FICO’s (Fair Isaac Corp.) UltraFICO Score, will rely on traditional data compiled by FICO and augmented by cash flow data collected by Plaid, according to a Thursday (Nov. 20) press release.

FICO is known for its score used by lenders to decide a borrower’s creditworthiness, while Plaid’s business is helping consumers connect online financial data across banks, FinTech apps and brokerages, the release said.

“By bringing together FICO’s trusted credit score intelligence with Plaid’s cash flow data, we’re creating the foundation for more comprehensive lending decisions,” Julie May, vice president and general manager of B2B scores at FICO, said in the release.

The partnership follows last month’s announcement of Plaid’s LendScore, a credit score that the company said is designed to create a more complete financial picture. It takes into account variable income, fluctuating expenses and financial activity that is spread across multiple platforms.

“High-quality cash flow data is becoming essential for lenders who want a more comprehensive view of a consumer’s financial picture,” Plaid Head of Partnerships Adam Yoxtheimer said in the Thursday press release.

The enhanced UltraFICO Score will employ cash flow data, which is historical and current information about the money moving into and out of accounts like checking, savings or money market accounts. This will be accessed via Plaid’s “open finance network of consumer-permissioned data,” the release said.

The PYMNTS Intelligence report “Consumer Credit Economy: Strategy vs. Spontaneity—Navigating the Great Credit Divide” found that building or improving a credit score ranks as the top motivation for why people seek new credit cards.

Among people without an active card, 26% pointed to credit building as their chief reason for wanting one, ahead of rewards, convenience or managing cash flow.

Also Thursday, FICO launched a partnership with GFT Technologies to help banks prevent fraud and simpify risk decisions using AI.

The collaboraiton melds GFT’s expertise in cloud, data, and digital banking with FICO’s solutions for fraud detection, credit risk, and decision management, the companies said in a news release.

“For too long, financial institutions have managed risk through fragmented systems that increase complexity and cost, said Rishi Chohan, CEO USA at GFT

“Through our partnership with FICO, we’re delivering a unified platform that consolidates essential risk-management tools into a single solution, helping banks improve efficiency, reduce costs, and strengthen compliance.”