Nottingham Evening Post Via Thomson Dialog NewsEdge)High street banks and credit card companies in Notts could soon use a system to predict how likely someone is to become bankrupt.
A software package developed by Nottingham-based business information giant Experian could be used as part of their decision-making process.
It follows the increasing number of people declaring themselves bankrupt.
The Experian Bankruptcy Score was developed after analysis of consumer credit card bureau data.
Simon Harben, senior vice-president of Global Analytics at Experian-Scorex, said: "The continuing rise in UK consumer bankruptcies has made it more important than ever for lenders to be able to identify and react to the early signs of potential bankruptcy amongst their existing customers." The number of people going insolvent has soared by nearly three-quarters during the past year, latest Government figures reveal.
Peter Brooker from Experian said: "Lenders want to lend responsibly and retain profitability.
"Personal bankruptcy has been on the increase and the idea is that the Experian Bankruptcy Score will help stop people getting into greater financial problems.
"We are always looking at better ways to analyse what's going on in the market place to find better ways to predict outcomes to lend to someone and this is one way of doing it." Mr Harben added: "It is generally acknowledged that highly credit active 25 to 45-year-olds living in rented accommodation are the group with the highest risk of personal bankruptcy.
"This new, pre-emptive score will provide lenders with an early warning of serious debt problems to come, and a number of major UK lenders are already investigating how best to incorporate the Bankruptcy Score into their existing customer management strategies." Mr Brooker said the objective was to help lenders manage their customer portfolios better.
Debt charity Consumer Credit Counselling Service said the increase in the number of people going insolvent was down to consumers knowing where to go for help.
A CCCS spokeswoman said: "About five to six per cent of people who take on debt get into real difficulties and that has stayed the same for quite a long time.
"I think the increase is more likely to be because people know where to go for help, particularly the 142% increase in people taking out Individual Voluntary Arrangements (IVAs). They are now much more heavily advertised."
