MANILA - A system for assessing a person's creditworthiness will soon be introduced in the Philippines, U.S. credit scoring company FICO said on Thursday.
FICO said it has partnered with Consumer Creditscore Philippines (CCS) to compute credit scores for Filipinos.
In the U.S., a credit score guides banks, credit card companies and other financial institutions about a person's creditworthiness, with a higher score thought to be more likely to pay back a loan.
"Good credit increases a borrower's chances of getting a loan or the credit card faster; secured with better, lower interest rates and terms," FICO said.
FICO calculates the credit score using a proprietary formula based on a person's payment history, level of indebtedness, length of credit history, new credit, and types of credit used.
The company, however, admitted that it would need to modify the formula in the Philippines because only 14 percent of the population have bank accounts and usually pay on a cash basis.
FICO did not say when it will introduce the system and which companies will be using it.