Fair Isaac Corp. is preparing to revamp its FICO credit ratings system in a way that will create a larger gap in scores between consumers with good and bad credit. Consumers with scores of 680 or above will likely see their scores increase more easily, while consumers with scores of 600 or below will be treated more harshly if they continue to struggle with their payments.
Banks are spending billions of dollars on technology, often with little idea what the return is on that investment, Elisa Martinuzzi writes. As fintechs grow their market share, investors must hold banks' feet to the fire to devise metrics and articulate how their investments in digitization and technology are affecting their bottom line.
Up to 10 Wells Fargo executives reportedly may face civil charges from the Office of the Comptroller of the Currency. The charges are in relation to a 2016 case where bogus accounts were created by Wells Fargo employees.
The success of branchless bank Ally Financial shows consumers have not lost interest in digital banks even as interest rates has declined. Retail deposits grew 5% at Ally while the rates on the deposits dropped by 9%.
StubHub has unveiled a partnership with fintech Affirm to give US customers the option to buy tickets to live events on a payment plan, up to $17,500. Credit decisions will be made within seconds, and plans will span three, six or 12 months with interest rates from 10% to 30%.
PayPal's new partnership with China's UnionPay subsidiary, UnionPay International, gives it another entree into China's market after its investment in GoPay. A PayPal executive said the goal is not to compete with Chinese payment giants but to create a two-sided network to bring Chinese customers to the rest of the world, and vice versa.
Fifth Third Bank's expansion into southern states could lead to more branch openings than closings in 2021, according to CEO Greg Carmichael, reversing the trend in previous years. The bank will pursue partnerships or purchases of fintechs, and is creating new products that include a financial risk management platform for commercial clients, he said.
Cross-border lending is experiencing the fastest growth in at least six years, according to the Bank for International Settlements, and nonbank financing is leading the charge. Shadow banks are generally less protected from risk than banks, and Mike Bird writes that their growth raises questions on what they would do in a financial crisis.