The algorithmic verdict arrived
in less than sixty seconds: credit card application denied.
My
application resulted from a clerk’s scripted suggestion at checkout that I
could get a 10% reduction on my 4k HDTV purchase at Best Buy simply by applying
for their branded Citibank credit card. Sure, why not?
Imagine my embarrassment
when, at point of purchase, with other buyers in line behind me, “Deadbeat Rob”
was holding up the line insisting on his creditworthiness. After a full minute of “careful consideration,”
(language contained in the scripted letter from Citibank explaining its
verdict), three coordinating players reached a conclusion that I lacked “sufficient
credit experience.”
A pox of
all their bourses: Experian for failing to generate a complete record of my
credit “experience” and its policy of preventing interaction with a live person,
EVER; Citibank for relying on Experian’s lazy, defective and incomplete credit
recording; and Best Buy for allowing Citibank and Experian to ruin my interest
in ever setting foot in their stores.
I base my
grievances on the common-sense view that I AM credit worthy: nearing 64, I have
managed to make timely payments on six figure mortgages and hefty credit card
balances. I have an 800+ credit rating
and five figure credit allowances. I
would reach the important 15-20 year experience with the same credit card, but
the number drops to zero almost every time I receive an unsolicited, new card,
with a different account number, because of a security breach.
I have
plenty of evidence to prove credit worthiness, if Experian and the other credit
rating and reporting companies had algorithms making decisions based on the
likelihood of not defaulting. I have concluded
that Experian has a mandate to predict likely use of credit, particularly
likely need/inclination to pay on time.
Creditworthiness appears to be a secondary consideration.
It may be
that Experian deemed my credit history “inadequate,” because I have this measurable
and reportable history of paying debts on time and a predisposition not to incur
debt in the first place. I apparently
lack credit experience, because I have not joined the more common ranks of
people willing, or obligated to pay 24% or more on credit card debt.
I did get
the opportunity to discuss this matter with a live, breathing human at
Citibank. She started with a scripted
response mentioning that I while I did not “qualify” for a platinum colored
card, I could receive a gold one upon paying a $59 annual fee. With some prodding, she suggested that I
could become more experienced with credit if I took out a mortgage, paid
interest on credit card debt, used my cards more frequently, generated balances
closer to my allowance and used more cards—like most red-blooded Americans.
This
experience and my ongoing research of two-sided markets confirm that people who
pay in cash subsidize credit card users and encourage debt, perhaps even
unsustainable debt.
Perhaps the
Experian algorithm detected me as someone unlikely to incur debt, or even to
use the credit card regularly. Guilty as
charged.
