Is Fair Lending Fear Holding Your Business Back?

The Equal Credit Opportunity Act and the Fair Housing Act were created to protect consumers from unfair and discriminatory lending practices. This covers a whole host of things, like discrimination based on race, religion or marital status when it comes to credit transactions or housing-related lending.

The creation and enforcement of these laws are invaluable to the everyday consumer, but with such strict regulations comes a unique set of challenges for financial institutions. How can you market your products and services to would-be buyers if you can’t determine who they are, for fear of breaking the rules?

The answer may be simpler than you think. You can reach your best (current and future) customers efficiently without risking fines, penalties or irreversible damage to your reputation and success. You can create an advertising message that hits the inbox of consumers who perfectly fit your product’s intent. And, you can avoid reaching people who aren’t interested in your services.

How is this done? By using syndicated financial segmentation. But we’re not talking just any segmentation – we’re talking Claritas P$YCLE Premier, which was built with financial marketers in mind.

Marketers across all industries face a tough battle, and financial and insurance marketers are no exception. You’re tasked with things like comparing actual market penetration rates against potential market size and measuring market and branch composition to identify marketing strategies. You set performance goals and develop and enhance products based on usage patterns; it’s a lot to stay on top of, but that’s where smart targeting methods come into play.

P$YCLE® Premier was developed to overcome challenges like these, and then some. It’s not just a simple score on a CRM file. It’s an actionable solution that helps you market smarter and ultimately win bigger as a company. All this, and it’s regulatory compliant, so you don’t have to worry about potentially falling into a trap of UNfair lending practices or even breaching the trust your consumers have when it comes to their privacy.

When you listen to the recent podcast we recorded, you’ll hear all about why P$YCLE Premier is the solution that helps you solve your fair lending challenges easier than ever before.

Meanwhile, here are three ways P$YCLE Premier helps you reach your best customers while complying with fair lending practices:

1. It can be used both internally and externally. You can safely pass your customer file to us and we can code it with the segments that align with your consumers, so you know the types of messaging that specific types of consumers respond to, the products and services they’ll be most interested in, and how to keep them loyal and satisfied. You can also use it behind your company’s firewall, ensuring no data ever leaves your four walls, complying with any security measures your company has on top of both “common sense rules” and important industry regulations.
2. There is no information about unique individuals (PII) or households published or reported within the segment assignments. The 60 segments that make up P$YCLE Premier are based on general consumer behavior and demographic characteristics that are then aggregated or modelled to represent millions of households. We designed it this way to help ease the burden of staying compliant – we take that on for you!
3. Race and ethnicity are not drivers in the P$YCLE Premier model. We make it easy to complete the portrait of your consumers without the use of sensitive variables. You can still answer questions like: “Who are my ideal customers?”, “What are they like?”, “Where can I find them?” and “What type of messaging do they respond best to, and through which media?” And you never have to worry about being accused of marketing unfairly.

We only just scratched the surface of how segmentation can help financial institutions succeed in a regulatory-compliant and privacy-safe way. But you can find out more in our latest episode of The Why Behind The Buy podcast (available to listen on your computer, here).

And stay tuned for upcoming podcast episodes, more blog posts, and future thought leadership articles diving deep into the hot topic issues buzzing through the financial and insurance industries.