Equifax Canada Co.

Predictive analytics used to develop new credit risk scores and value-added services

Published on 15-Aug-2013

"If banks, insurers and utilities can predict when customers are likely to move, they can offer them compelling reasons to stay with them, boosting customer loyalty and retention rates and increasing the ROI for marketing campaigns." - Director of Modeling and Analytics

Customer:
Equifax Canada Co.

Industry:
Banking

Deployment country:
Canada

Solution:
BA - Business Intelligence, Big Data & Analytics, Big Data & Analytics: Customers, Smarter Planet

IBM Business Partner:
Knowledge Providers Inc.

Overview

Based in Toronto, Equifax Canada is a subsidiary of a global leader in information solutions for businesses and consumers.

Business need:
Credit bureau Equifax Canada sees significant potential for growth in the Canadian market by complementing its traditional credit- scoring offerings with innovative analytics services based on modeling vast quantities of customer data gathered by its banking, utilities and communications customers.

Solution:
A prime example of these new value-added services is a predictive “mover’s model,” which analyzes consumers’ postal codes, credit balances and other variables to generate tailored insights that providers can use to send consumers targeted, well-timed offerings, such as for arranging new electricity supplies or purchasing new insurance policies.

Benefits:
The mover’s model built by Equifax Canada boosted one service provider’s ability to predict which of its customers are most likely to move in the next six months by approximately 40 percent over the provider’s original model.

Case Study

Based in Toronto, Equifax Canada is a subsidiary of a global leader in information solutions for businesses and consumers. In recent years, the organization expanded beyond its roots as a traditional credit bureau serving primarily lenders to offer tailored, analytics-driven solutions that deliver high-value insights to companies in a range of industries, including banking, utilities, communications and retail.

The Opportunity
Credit bureau Equifax Canada sees significant potential for growth in the Canadian market by complementing its traditional credit- scoring offerings with innovative analytics services based on modeling vast quantities of customer data gathered by its banking, utilities and communications customers.

What Makes It Smarter
A prime example of these new value-added services is a predictive “mover’s model,” which analyzes consumers’ postal codes, credit balances and other variables to generate tailored insights that providers can use to send consumers targeted, well-timed offerings, such as for arranging new electricity supplies or purchasing new insurance policies. The bureau also created a more accurate credit risk score that outperforms previous generations of scoring models.

Real Business Results
The mover’s model built by Equifax Canada boosted one service provider’s ability to predict which of its customers are most likely to move in the next six months by approximately 40 percent over the provider’s original model. The model also proved 365 percent more effective when compared with a baseline of random selection scores. Using intelligence provided by the new credit risk score to better gauge applicants’ creditworthiness, one Big Five bank in Canada saved an estimated CAD2.5 million annually.

For more information
Please contact your IBM representative or IBM Business Partner. Visit us at ibm.com/spss.

To learn more about Equifax Canada, visit www.equifax.com

Products and services used

IBM products and services that were used in this case study.

Software:
Cognos Business Intelligence Developer Edition, SPSS Statistics, SPSS Modeler

Legal Information

© Copyright IBM Corporation 2013 IBM Corporation Software Group Route 100 Somers, NY 10589 Produced in the United States of America August 2013 IBM, the IBM logo, ibm.com, SPSS and Cognos are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide. Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the Web at “Copyright and trademark information” at www.ibm.com/legal/copytrade.shtml. This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available in every country in which IBM operates. The performance data discussed herein is presented as derived under specific operating conditions. Actual results may vary. THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON- INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided.