More Lenders are Turning to VantageScore as Usage Climbs 55% Over a Year

Use of VantageScore credit scores increased by a staggering 55% from 2023 levels to a new record of 42 billion scores delivered throughout the year. The upswing serves to reinforce the rise of VantageScore as a lending and finance titan.

A key driver of the wave of new use was the increased use by credit card issuers and personal loan providers of VantageScore. Banks are finding that they increasingly use the model not only as a basis for acceptance or rejection of a transaction, but also for managing consumer credit portfolios. 

Tenant screening was another driver of the boom because more landlords and property managers began using VantageScore to evaluate rental applicants.

The popularity of VantageScore comes at least in part from the fact that it’s available more broadly. The company says that approximately 37 million consumers who might otherwise be considered “unscoreable” under existing models are eligible for a VantageScore credit score.

That availability is most advantageous for consumers who have limited credit histories or are restoring credit after going through economic hardship.

“Our customers broadly accelerated their usage of VantageScore credit scores in 2024, resulting in record-breaking growth and the highest overall credit score volume in company history,” said Silvio Tavares, President and CEO of VantageScore.

Tavares continued, “These results are a confirmation by lenders, fintechs and other customers that VantageScore is the credit score industry leader in growth, predictive power and innovation.”

Growth comes at a time when the broader world of credit scoring is evolving. 

While FICO remains ahead of the pack for mortgages, VantageScore gained a strong foothold everywhere else, particularly among unsecured lending institutions, fintech markets, and rental markets. 

VantageScore is becoming more popular among unsecured lending institutions and fintech markets.

The rapid expansion of use could allow VantageScore to play an even bigger part as lenders increasingly turn to more advanced ways of assessing the creditworthiness of consumers.

While VantageScore did demonstrate broad acceptance, the most widely used scoring model by lenders remains FICO. 

FICO estimates that about 90% of the most prominent lenders use FICO scores when they make lending decisions. Its supremacy is particularly difficult to dislodge within the mortgage market, where its scores hold sway over underwriting. 

FICO remains the most popular scoring model for mortgages.

Competition is picking up, however, as the Federal Housing Finance Agency (FHFA) allows mortgage lenders to make use of the FICO 10T and the VantageScore 4.0 models on loans they sell Fannie Mae and Freddie Mac.

The company also propelled revenues 16% higher, to $1.72 billion in the 2024 fiscal year. The environment of credit scoring is evolving, as suggested by a diversification trend as lenders look toward VantageScore while they cling tight to FICO.

More generally, the increased strength of VantageScore indicates the manner the credit industry is reconsidering how it measures consumer risk. 

Most importantly, the introduction of VantageScore 5.0 introduces groundbreaking advancements to minimize the inconsistencies between the scores of the top three reporting agencies (96% of consumers within a 40-point range), enhancing the alignment between lenders as well as consumers.

Lenders anticipate eventually moving toward information-driven scoring models. Greater use of the VantageScore will redefine credit underwriting criteria, the risk management process, as well as the competitive dynamics within the industry.

The shift could expand consumer protection and get lenders to consider a move toward a multiscoring environment.