Achieving Accuracy and Compliance for Consumer Credit Bureau Reporting

Challenge

A large financial institution engaged Guidehouse to assess its consumer credit bureau reporting system. Based on our findings, we determined that the client needed a historical analysis of more than 800,000 personal loans, auto leases, and auto loans that required revised payment histories with an upcoming year-end deadline for completion. This would entail calculating payment history profiles and adjusting certain bankruptcy fields to meet standards set by the Fair Credit Reporting Act and Credit Reporting Resource Guide. The already complex work was complicated by historically inaccurate data and limitations affecting the client’s ability to quickly obtain, process, and calculate system data.

Approach

Our team developed an approach and quality control process to support the automated calculation of payment history profiles for about 800,000 accounts. Based on individual account-level characteristics and historical activity, we also calculated account information dates, account status as of those dates, payment ratings, and dates of first delinquency in accordance with Credit Reporting Resource Guide standards.

To expedite the analysis, we designed and built a rules-based automation engine to calculate required data fields. For the remaining accounts that couldn’t be analyzed using the automation tool, we deployed a team of about 150 offshore and 50 onshore analysts to recreate the payment history profiles and manually calculate the required data fields using internal systems of record.

Each week we packaged reports containing the revised payment history profiles and additional data fields based on account type, then transmitted them to the client to review the results and upload the data to consumer credit bureaus.

Impact

The client was able to complete the required work well ahead of critical deadlines with a less than 1% error rate for the manual processing. All impacted consumers had their credit reports updated to accurately reflect their account’s payment history.