Transaction Risk Score
Smarter credit decisions through transaction-level insights
Unlock deeper insights into consumer financial behaviour
Many sophisticated analytics team are starting to assess the ability of transaction and spend behaviour to support risk scoring.
The Experian Transaction Risk Score is a powerful decisioning tool that leverages transaction-level data to enhance credit risk assessment and underwriting precision. Built using advanced analytics and machine learning, Transaction Risk Score enables lenders to make smarter, faster, and more inclusive credit decisions, especially in the era of open banking.
Higher bad rates
Applicants with Buy Now Pay Later (BNPL) fees show 70% higher bad rates than those without BNPL fees.
Lower risk
Applicants who set up for direct debits are 20% lower risk than those who don’t, suggesting stronger financial discipline.
Higher credit risk
The presence of debt collection activity correlates with a 120% increase in credit risk, making it a critical signal in risk assessment.
Transaction Risk Score
The Transaction Risk Score combines data features using a traditional modelling technique, logistic regression. This linear modelling technique has been an industry standard for decades, supporting Transaction Risk Score to ensure it remains robust over time. Every data feature that is used in the score calculation has been validated by credit experts to ensure that the feature's contribution to a score follows a logical trend.
Transaction Risk Score - ML
The Transaction Risk Score-ML combines data features using a Machine Learning technique called Extreme Gradient Boosting, or XGBoost for short. This approach can better identify non-linear trends in applicants’ transaction patterns.
While Transaction Risk Score-ML has been shown to deliver superior business outcomes over Transaction Risk Score for some credit providers, this benefit comes at the cost of reduced model interpretability.
Transaction Risk Score-ML will be updated periodically into the future to further improve its power.
Dual scoring models for flexibility
Choose between Transaction Risk Score (logistic regression) for interpretability or Transaction Risk Score-ML (XGBoost) for enhanced predictive power.
Extensive transaction data coverage
Built from over 1 billion transactions across 2.5 million accounts and 160+ financial institutions, offering deep behavioural insights.
Expert-validated feature engineering
Over 1,000 engineered features validated by credit experts ensure logical, actionable insights.
Actionable risk indicators
Detect high-risk behaviours that are proven predictors of credit risk.
Improve acceptance rates without increasing risk
Combine Transaction Risk Score with Experian’s Credit Score to expand your applicant pool while maintaining portfolio quality.
Boost profitability
Case studies show that integrating Transaction Risk Score can deliver up to a 20% uplift in profit through better risk segmentation and pricing.
Accelerate decisioning
Use Transaction Risk Score in automated refer/decline rules or embed it within your application scorecards for seamless integration.
Adapt to Open Banking
Future-proof your credit decisioning with a solution designed for the open data era.
Bank Statements
The secure and easy way to retrieve your customers' bank statements instantly.
Decision Metrics
Understand customer behaviour with enriched transaction categorisation and insights.
Open Banking
Access secure, consent-driven data for faster and more transparent lending.
Bank Feeds
Real-time transaction data feeds for ongoing financial monitoring.
Statement OCR
Extract and digitise data from uploaded bank statements with high precision.
Broker Flow for Lenders
Allows lenders to access customers' statements directly to accelerate application processing and improve conversion.
Broker Flow for Brokers
Allows brokers to access customers' statements directly to simplify the application journey and boost client conversion.
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