Expanding financial access through smarter, more holistic risk insights

FICO is a global analytics software company best known for developing the FICO® Score, a suite of credit scoring models used in the majority of lending decisions in the United States. It helps lenders evaluate consumer credit risk and expand financial access responsibly.

Now, FICO is partnering with Plaid to bring lenders and consumers the next-generation of the UltraFICO® Score. Offered through Plaid’s Consumer Reporting Agency, the enhanced solution will be powered by cash flow data from Plaid’s open finance network to give lenders a more holistic view of creditworthiness.

To learn more about how FICO is thinking about the role of cash flow data in credit scoring and where this innovation is headed next, we sat down with Julie May, Vice President and General Manager of B2B Scores at FICO.

Plaid: Alternative data has gone mainstream. How has FICO's thinking evolved in using alternative data for credit scoring?

May: Alternative data has gone well beyond experimentation—it’s the new normal, and our thinking has continued to evolve as data sources have. FICO was the first scoring provider to introduce a generally available model that included cash flow data for consumer credit risk assessment, exemplified by the original release of the UltraFICO® Score in 2018. Our analysis and work with cash flow and other alternative data sources over the decades have continued to show that alternative data doesn't replace risk prediction capabilities of traditional credit information, but also shows that it enables additional detail on the financial picture of consumers when thoughtfully integrated into an array of credit risk strategies.

Our rigorous testing across millions of consumers and multiple data sources has shown how cash flow data, in particular, offers insights into financial management behaviors that strongly predict creditworthiness—creating upside for lenders and consumers alike.

Plaid: Why is now the right time to expand the use of cash flow data in credit scoring?

May: As open banking continues to develop in the U.S., we see both lenders and consumers becoming more comfortable with secure data sharing. The market recognizes the value of cash flow insights, and lenders are actively looking for ways to integrate this data into underwriting and decisioning workflows without operational complexity. The UltraFICO® Score solves this by delivering a comprehensive picture with high fidelity cash flow insights scaled to and utilized in combination with the market-leading FICO® Score that lenders already trust and understand. We're enabling lenders to deploy cash flow insights faster to improve credit outcomes.

Plaid: How does FICO view the balance between traditional credit data and cash flow data?

May: At FICO, we see traditional credit data and cash flow insights as complementary forces that create a more complete financial picture. Traditional credit data is a crucial tool for risk assessment, which cash flow data from Plaid complements with real-time context about how consumers manage their money. We're strategically blending these signals to enhance accuracy and inclusivity in today's evolving financial landscape.

Plaid: How does working with Plaid enable innovation in credit scoring and why did you choose Plaid as your partner?

May: Plaid was the natural choice for FICO because its network provides access to financial data at scale, which complements our credit scoring expertise.

This partnership delivers exactly what lenders are asking for—a simple way to transform cash flow data into actionable insights for credit decisions. Our next generation of UltraFICO® Score offers three key advantages for lenders:

• Operational simplicity. Lenders get a streamlined implementation, minimizing operational complexity and accelerating onboarding.

• Familiar integration. Our enhanced score aligns with traditional FICO® Score odds, so risk teams can roll it out immediately using existing frameworks without retraining or redefining risk appetites.

• Universal compatibility. Lenders have the flexibility to use a cash flow model with the traditional FICO Score irrespective of the channel they use for the FICO Score.

Plaid: How does FICO ensure that new scoring models will maintain the same level of fairness, transparency, and regulatory rigor that lenders expect?

May: Fairness and regulatory compliance are foundational to every FICO® Score solution. Our rigorous governance framework ensures every scoring model undergoes extensive testing to deliver reliable, predictive, and accurate assessments while maintaining fair and responsible lending practices.

We maintain full model explainability with clear methodologies and comprehensive reason codes that regulators and lenders expect. Our innovations preserve the familiar odds-to-score alignment that lenders trust in the FICO® Score, which is the independent standard in credit scoring trusted by 90% of top U.S. lenders.

FICO applies a rigorous approach to fair lending when integrating behavioral data like cash flow insights. Each data source and model undergoes appropriate testing for bias, with legal and compliance teams, designed to ensure adherence to fair lending laws such as ECOA. Clear reason codes explain decisions influenced by behavioral data, aiding understanding by consumers and regulators. FICO monitors model performance for ongoing fairness, transparency, and compliance—supporting responsible, inclusive lending practices.

Plaid: Looking ahead, how does FICO see cash flow data shaping the future of financial inclusion?

May: By blending traditional credit data with Plaid’s real-time cash flow data, the UltraFICO® Score can deliver enhanced predictive power that enables lenders to manage risk, optimize offers, and responsibly expand credit access to millions.

This broad scoring assessment gives lenders an enhanced financial story for a more comprehensive view of credit readiness. FICO’s mission has always been to broaden credit opportunities while maintaining the highest standards of fairness and accuracy. Integrating cash flow data gives lenders the predictive insights they need to say "yes" more often and more confidently.

By combining proven credit scoring expertise with industry-leading data infrastructure and FCRA-compliant insights for cash flow underwriting, Plaid and FICO are driving the next generation of credit innovation. We’re enabling lenders to confidently serve more consumers while helping millions access credit based on a more complete financial picture. 

To learn more about the new collaboration between FICO and Plaid, reach out to our team: fico@plaid.com. 

Explore how Plaid’s credit solutions - powered by real-time cash flow data and unique network insights - can help you make more confident lending decisions and expand access to credit today.