Why is credit scoring important?

Credit scoring is a procedure where an institution or an individual is evaluated based on its past payment patterns. In today’s highly globalized environment credit scoring is getting important day by day. It is important firstly, because it reduces the time and energy spent when evaluating a customer to give credit or enter into a transaction. The counterparty which is mostly the creditor or banks, checks the credit worthiness of its applicant just by entering simple identity numbers such as a social security number (SSN). This might well be the Tax ID or Citizenship ID depending on the country the method is employed.

Do you know your score?

Nathan Froehlich had never checked his credit report before. He didn’t know what his credit score was. On Monday, the North Dakota State University senior went over his report and score with Joshua Hahn, a personal banker at Starion Financial. Froehlich was pleasantly surprised. “It’s higher than I would have thought it would be,” he said.