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What Is a FICO 8 Bankcard Score?

Credit Cards, Credit Score
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There’s no doubt about it: The credit rating system used in the United States is hard to navigate. Staying on top of your score can feel overwhelming, especially when the rules of the game change.

The Nerds recently found out that a special type of credit score developed by the folks at FICO has started to gain traction among lenders. We did some digging to find out what the FICO 8 Bankcard score is all about, so be sure to take a look at the details below. This number could be what stands between you and your next credit card.

The purpose of a separate score

Every time you apply for a loan, your bank pulls your credit to decide whether or not to lend or grant the loan. The bank is most likely looking at your FICO score, which is the most commonly used credit rating model in the United States today.

Your FICO score is a numeric representation of your history with handling borrowed money – in this way, it’s supposed to help predict how you’ll treat future credit accounts. So what’s the point of developing a separate score? To answer this question, the Nerds reached out to Anthony Sprauve, a senior consumer credit specialist at FICO. Sprauve explained that:

“The FICO 8 Bankcard score is a variation of the base FICO Score that is optimized to weight the credit card history of a consumer more than the base score. This version of the base FICO Score was developed at the request of our credit card customers to give them a FICO Score that more closely addressed their needs.”

In other words, the FICO  8 Bankcard Score doesn’t consider all credit to be equal; this is the main difference between it and your traditional FICO score. The FICO 8 Bankcard Score narrows in on your behavior with credit cards specifically, and rewards or penalizes you accordingly. This is why credit card companies are starting to look at your FICO 8 Bankcard Score.

How you’re evaluated

First, it’s important to understand that the exact metrics used to create customers’ FICO 8 Bankcard Scores aren’t completely known. FICO hasn’t released this information to the public. However, we do know a few general things about the FICO 8 Bankcard scoring system:

  • The score range is 250-900. This is broader than the traditional FICO score’s range of 300-850.
  • Both the base FICO score and the FICO 8 Bankcard Score look at similar credit-related behaviors. However, some factors are weighted more heavily in the FICO 8 Bankcard Score than they are in the conventional FICO score (more on that in a minute).
  • The New York Times reports that many consumers’ FICO 8 Bankcard Scores are very similar to their base FICO scores. This makes sense given that similar metrics are being used to create each score.

But more specifically, how does the FICO 8 Bankcard scoring system differ from that of the traditional FICO score? Again, this isn’t completely known. However, it’s reported that:

Becoming an authorized user may not help – People with poor credit sometimes convince a friend or acquaintance with good credit to designate them as an authorized user. This is meant to help improve bad credit faster. But due to some sketchy tactics used by past customers, your FICO 8 Bankcard Score might not be helped as much by gaining authorized user status.

A high utilization ratio hurts more – In the conventional FICO model, your credit utilization ratio accounts for 30% of your score. In the FICO 8 Bankcard Score algorithm, credit utilization is more closely scrutinized. This means that carrying a big balance on your cards will do more damage to your FICO 8 Bankcard Score than it will to your base FICO score.

One-off late payments won’t pinch as much – Your history with paying your bills on time accounts for the biggest part (35%) of your conventional FICO score; missing a payment by 30 days or more could cost you big points. However, in the FICO 8 Bankcard Score model, an isolated late payment won’t sting as much.

But be careful – if you habitually make late payments on your credit card bills, your FICO 8 Bankcard Score will suffer more than it would in the traditional model.

Scoring high with FICO 8 Bankcard

It’s not completely known how many lenders are using the FICO 8 Score when deciding whether or not to give you a credit card, nor is it totally clear how to build a high score. This is frustrating if you’re trying to keep all your credit ratings in good shape.

For now, your best bet is to keep up with the good credit habits you’ve been using to bolster your base FICO score. These include:

  • Paying your bills on time
  • Keeping your credit utilization ratio low
  • Establishing credit as soon as you can
  • Limiting new credit applications
  • Keep a healthy mix of credit accounts on your report

For the purposes of the FICO 8 Bankcard Score, it’s best to pay special attention to the first two factors, since they appear to carry more weight than the others.

The bottom line: The FICO 8 Bankcard Score is designed to put more emphasis on your financial behaviors with credit cards. It’s unclear exactly how this score is determined, but the Nerds will be sure to keep you in the know. Check back often for updates!

Credit scoring image via Shutterstock