illion introduces new transaction scores

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on May 21, 2021
illion introduces new transaction scores

A new service from credit reporting agency illion allows financial institutions to better scrutinise customers' transaction data.

The new 'Transaction Risk Score' more closely scrutinises cash use patterns, income frequency, and loan repayment trends, and forms part of the wider comprehensive credit reporting method.

One red flag identified in the new transaction score is a customer on a prepaid phone plan, according to illion's Head of Modeling Barrett Hasseldine.

"For a consumer to be given a post-paid mobile service, they must have successfully passed a credit history check," he told Savings.com.au.

"As such, individuals with bad credit histories disproportionately use pre-paid mobile phone plans."


Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Lender
Advertised rate Comparison rate* Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
FixedMore details
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.

Rates correct as of January 25, 2022. View disclaimer.

Another red flag identified includes customers withdrawing large sums of money via ATM on payday, which could indicate spending on gambling and other vices.

"The score identifies individuals who are withdrawing cash at ATMs on payday and reduces their score as a result. If the individual transfers money to a different bank account electronically, their score is unaffected," Mr Hasseldine said.

illion CEO Simon Bligh called the new transaction score a "game changer".

"Banks and credit providers hold a raft of data that shows both the financial state and spending behaviour of their customers. What the score does is mine this data and make sense out of it in a straightforward manner," he said.

“An example of an insight we have developed is that there is a strong correlation between an individual’s risk and the amount of their salary they pull out of the ATM on pay day.

"We have developed thousands of these insights."

The new transaction score forms part of illion's open banking rollout, in which the agency is one of the few institutions to be granted data accreditation. 

Mr Bligh also said the transaction score can also lead to cheaper home loans.

“There are upsides for consumers as well as credit providers, with the key insights needed to unlock more tailored lending terms and conditions and a broader range of products through enhanced credit underwriting and more suitable loan pricing," he said.

“This is good for financial institutions who can price more efficiently, lend more responsibly and do so at lower cost, and it is good for consumers who will have an expanded choice and get the products that are right for them, quickly.

"It’s one of those rare innovations where everybody wins."


Photo by Tim Mossholder on Unsplash

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison is passionate about breaking down complex financial topics for the everyday consumer.

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