Key Takeaways
- Fair Isaac said it would provide its FICO credit scores directly to firms that provide credit reports to lenders. The data provider said the decision would eliminate reliance on the three nationwide credit bureaus.
- Shares of those credit bureaus declined on the news, while Fair Isaac’s jumped.
Shares of two credit-score providers sank after data provider Fair Isaac (FICO) said it would offer its scores directly to firms that sell consolidated credit reports to mortgage providers.
Equifax (EFX) and TransUnion (TRU) were recently off 9% and 12%, respectively. The companies did not respond to Investopedia’s request for comment in time for publication. Fair Isaac shares soared on the news, recently rising about 20%.
Fair Isaac said its FICO Direct Mortgage License Program would give the information to tri-merge resellers—those that combine data from the major credit bureaus into one report—and give them the ability to calculate and distribute the FICO scores directly to customers, “eliminating reliance on the three nationwide credit bureaus.”
Fair Isaac said the move “streamlines score access, saving lenders up to 50% on per score FICO fees.” CEO Will Lansing called the change “a turning point in how credit scores are delivered and priced across the mortgage industry.”
Why This News Is Significant
Fair Isaac aims to reshape the industry with its move to bypass the big credit bureaus in mortgage scoring. Lenders may save money by cutting out Equifax, TransUnion, and Experian as middlemen—but the news nevertheless threatens a critical revenue stream for the bureaus, all of which was reflected in the companies share moves today.
The third major credit score provider, Experian, doesn’t trade its shares in the U.S., although they dropped in London.
Shares of Fair Isaac remain in negative territory in 2025. They fell earlier this year after the FHFA said mortgage companies could use a credit scoring system created by its competitors.
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