How Much Would The SECURE Act Actually Cost?

We decided to do a little bit of basic math to work out how much offering free credit scores to consumers would actually cost. This is one of key components for the new SECURE act.

• FICO sold 10 billion scores last year
• They had revenue of $737.77 million
• Gross profit of $513.98 million
• Operating cost of $223.79 million

From this we can deduce that on average each FICO score costs the company $0.022379 or 2.2379¢.

The most likely route to deliver FICO scores directly to consumers would be to add the option to receive them when they receive their free credit report from annualcreditreport.com. On June 19th, Stuart k. Pratt (President & CEO of the Consumer Data Industry Association) made a statement to Committee on Financial Services, House of Representatives that “Between December of 2004 and December of 2006, over 52 million free reports have been issued through www.annualcreditreport.com”.

This works out to be 26 million reports per year. If all of these consumers opted to also receive their credit score, it would cost a total of only $581,854. Furthermore if United States persons over the age of 18 (240,113,369.025 persons according to US census data) wanted access it would cost only $5,373,497.08541.

That’s right, every person in the US could have access to a free credit score for less than $5.5 million per year. The question will come down to who should pay this bill. FICO & other scoring agencies will argue that it shouldn’t be them, the national credit reporting agencies won’t want to foot the bill and neither will the government. At the end of the day the scoring companies are making obscene profits from selling this packaged data and should be responsible for providing it for free to consumers.

If you haven’t already, I strongly recommend sending your local representative a letter of support for the SECURE act to pass. Read our what to do next section on our coverage of the SECURE act for more information.