Psychometric Test Brings Credit Scores to Undeveloped Countries

In America, a credit score assesses a person’s ability to pay back a loan. We have numerous factors and databases that go into making this score, but other countries aren’t as fortunate.

As a result, a new test has emerged to give consumers in undeveloped countries a chance to borrow the money they need.

The Entrepreneurial Finance Lab’s test was originally developed as a doctoral project at Harvard. When MasterCard decided to hop on board with the project, it went to another level.

With this test, a company can assess a person’s ability to pay back a loan based on his mental state, not necessarily his past credit history. The test predicts future behavior based on answers to a series of specific yet simple questions.

This program is still in its infancy, but it gives hope to countries with weak, underdeveloped economies that may not have a way of assessing a person’s financial stability. Banks in 16 countries are already working on adapting this test to suit their needs, which could open doors for more than 70,000 needy small-business owners.

It may be the start of a great economic change for emerging markets in the years to come.

This entry was posted in Credit Card News and tagged MasterCard , credit scores , credit history , credit assessment , determining credit score , Entrepreneurial Finance Lab , psychometric test

The information contained within this article was accurate as of January 2, 2014. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website. Many of the offers on this article are from our affiliate partners, and LowCards.com may be compensated if you take action with any of our affiliate partners.

Most Popular Credit Card Categories On LowCards