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Why a Tri-Bureau Data Approach is Important to Lenders

Why a Tri-Bureau Data Approach is Important to Lenders

Before coming to Deluxe, I thought that all the credit bureaus were roughly the same. It really didn’t matter which one you worked with. It was simply a function of time (managing multiple bureau relationships), money and onboarding hassle – and the audience differences were minor and gaps were negligible. Here at Deluxe, we’ve worked hard to build great, long-standing relationships with all three bureaus. While you could work with just one bureau, Deluxe adds value by bringing all three credit bureaus into a single, comprehensive marketing environment daily. We believe this tri-bureau data (or tri-merge data) approach provides our clients:

  • The ability to see all credit activity of all credit-active consumers in the US
  • Complete access to the credit-active consumer marketplace for more effective credit campaign targeting and product offers
  • An incremental lift to targeted audiences by as much as 75% for tri-bureau campaigns
  • The opportunity to monitor data from all three credit bureaus daily, letting clients know immediately when customers and prospects are in-the-market for a loan and to engage them with a multi-touch, multi-channel campaign before the competition does.
  • An improved prospect risk assessment by evaluating credit criteria across multiple data sources for a more holistic and accurate tri-bureau rating view
  • Eliminated costs, time and extra steps associated with processing multiple data files

Recently, one of our largest clients put us to the test by asking us to answer the questions below. We did a custom analysis looking at the last 30-days to gain insights on trigger opportunities from all three bureaus. Here’s what we learned based on our client’s questions exactly as they were asked (results could, of course, vary based on any firm’s particular credit criteria and data.) Our answers are bolded below:

  1. Of the triggers we receive on a given day, how many would have been reported by each bureau that same day?
    • If we had only used Bureau #1 for credit trigger monitoring, which triggers would we have received? Approximately 63.7% of the daily feed.
    • If we had only used Bureau #2 for credit trigger monitoring, which triggers would we have received? Approximately 52.97% of the daily feed.
    • If we had only used Bureau #3 for credit trigger monitoring which triggers would we have received? Approximately 72.86% of the daily feed.
  2. Can you estimate the proportion of triggers that we receive which are true tri-merges vs single pulls? We are trying to understand the credit pull/trigger landscape as a whole here. Approximately 29.17% of the total triggers received (your matched criteria) hit all three bureaus. Within the universe, 33.86% of the triggers were with only one bureau.
  3. If we had only used Bureau #1 and Bureau #2, what proportion of triggers would we have received? You would have received 71% of the universe of triggers that we had delivered on that day.
  4. Based on your experience, what time period/sample would be sufficient to reliably answer these questions? We see some seasonality in the trigger volumes but overall the volumes stay relatively consistent and therefore a daily sample is sufficient to analyze as the variances are minimal.

Again, credit criteria vary from client-to-client, and product-to-product. And while one bureau can give you much of what you need. But it seems pretty clear that the tri-bureau data approach tests out as the best way to maximize your opportunity to reach 100% of the credit active market whether it be for daily triggers for customer retention or acquisition to expand market share. Just something to think about when considering credit marketing data needs in this red-hot lending market we are in.