Earlier this month, our Chief Credit Officer, Vinni Bala, met with students at the UC Berkeley, Haas School of Business. The students are currently taking a summer business course in consumer behavior with lecturer Bill Fanning. The course focuses on the study of how consumers process information, form attitudes and judgments and make decisions.
About Our Chief Credit Officer
During his visit, Vinni shared his background in the financial service industry, introduced the SelfScore brand, and walked students through the scope of the course’s final project. Prior to SelfScore, Vinni held leadership roles at Citi & Wells Fargo—where he managed their student and secured credit card portfolio. Today, Vinni leads credit strategy and operations at SelfScore.
About Course Professor
Professor Bill Fanning has been regularly teaching at the UC Berkeley’s Haas School of Business since 2007. He teaches both undergraduate and graduate business students in Market Research, Consumer Behavior, Advertising Strategy, and Marketing. Bill’s favorite part about teaching is seeing students head toward a career path unrelated to marketing, then make a sharp turn towards marketing once they have taken one of his classes. Outside of Haas, Bill leads a business that conducts qualitative market research.
Students’ Initial Reaction to Credit Cards
Before introducing the course project, students were surveyed on their knowledge of credit cards and credit scores. Out of fifty students, only five knew their specific credit score. Less than 10% of the class admitted that they actively discuss credit with their parents. And only three students raised their hand when asked if they think about their finances on a daily basis.
About 75% of the class was composed of international students. One student mentioned that she had applied for a credit card twice in the United States, but was rejected both times. When asked if she knew why she was rejected, she responded, “I don’t know why either.”
General Student Understanding of Credit Cards
Although the course’s responses might be a bit alarming, their answers were about the same as the general student population. According to a study on student descriptions of credit score conducted by Student Monitor, only 14% of the general student population said they were aware of the existence of credit scores. Within that 14% who said they were aware of the existence of credit scores, a startling over 50% did not know whether their score is good or bad.
Since 2013, there have been 37% new account growth in the overall U.S. credit card market. This growth was driven in-large part from millennials, which represents 23% of the total U.S. population, according to the Brookings Institute. When asked why they own a credit card, students provided these top five reasons: (1) to build credit history, (2) suggested by parents, (3) convenience for online shopping, (4) safer than carrying cash, and (5) emergency funds.
After the survey, students were introduced to SelfScore as a fin-tech startup with the mission to help deserving, but underserved population gains financial independence through access to fair credit and education—starting with international students.
The course project will require students to conduct market research among college students, understand their needs, interests, and attitudes toward credit cards, and deliver a final presentation on their findings that incorporates consumer behavior principles and theories. Students will deliver their final presentation later this summer.