Credit scoring market competition shifts as VantageScore enters U.S. market

The United States credit scoring market is seeing shifts in competition as the Federal Housing Finance Agency (FHFA) approved the entry of VantageScore to compete with the long-dominant Fair Isaac Corporation (FICO).

While increased competition aims to improve consumer access to credit, concerns have been raised regarding vertical integration. The three major credit reporting agencies—Experian, Equifax, and TransUnion—own VantageScore. This ownership structure gives these agencies control over the consumer credit data required by rivals like FICO to generate scores, potentially creating incentives to favor VantageScore.

FICO remains the industry standard, used by approximately 90% of creditors. Established in 1956, the company introduced the first standardized credit scoring model in 1989 to replace subjective lending judgments with data-driven mathematical assessments.