Challenge

myFICO offers consumers an all-in-one solution for understanding their credit with FICO® Scores, credit reports, and alerts from all three bureaus. People can get the right FICO Score for their credit goals, including the versions most frequently used when applying for a mortgage, auto loan, or credit card. myFICO’s tools and analysis enable people to simulate credit events and gain insights into their credit, including what’s helping and hurting their FICO Score. With the Free Plan, myFICO also offers access for eligible consumers to view their FICO Score for free.

For years, the company used a fully managed service to handle its billing, payment processing, tax, and fraud prevention. While the service was comprehensive, myFICO found that its performance was lacking. Outages—which caused failed payment and lost revenue—were too frequent, and the provider was something of a black box, offering limited data on billing, payments, and fraud. As a result, myFICO found it difficult and inefficient to resolve issues.

In 2022, myFICO began the search for a new payment partner that provided a similarly comprehensive range of technologies, but made it easier to refine each component of the billing and payment processing system. “One of the most important things was finding a provider that was very good at authorization, with high success rates,” said Geoff Smith, FICO’s vice president and general manager of consumer scores. “We also needed good processes, methodology, and tools to ensure that we could get as close as possible to successfully billing 100% of our consumers.”

In addition to those needs, myFICO wanted a partner that offered advanced security features, with robust fraud prevention tools to support myFICO’s identity as a trusted, secure resource for consumers’ sensitive financial information.

Solution

After evaluating several options, myFICO selected Stripe to provide a suite of technologies to replace its managed billing service, along with implementation and migration guidance from Stripe professional services and ongoing assistance from Stripe’s paid support team. “It was important for us to find a partner that was very modern and very high tech, and that had very robust systems,” said Smith. “We needed a company that was processing a large volume of payments for a large number of clients, so we could be confident that we’d have good stability and reliability.”

Stripe Billing gave myFICO better tools to manage its recurring revenue business, including much more control over involuntary churn. Engineers used a test clock to model subscription lifecycles, as well as the extensive set of webhooks that allowed for improved customer messaging and reporting. Billing also provided extensive reporting that gave myFICO clear insight into its business, such as reasons for declined payments, breakdowns of successes and declines by card type (prepaid, debit and credit cards), velocity controls, and fraud blocks.

The integration with Billing gave myFICO access to Stripe Payments for payment processing, which includes several optimizations to improve authorization rates. For example, Adaptive Acceptance identifies the best retry messaging and routing combinations to recover lost revenue after false declines, while Smart Retries uses AI to identify the best times to retry failed payments. Payments also allowed myFICO to adopt Stripe Elements, a set of embeddable UI components designed to improve checkout flow. Stripe’s Payment Element allowed myFICO to easily turn on additional payment methods without any coding or development time, including digital wallets Google Pay and Apple Pay, which enable frictionless card payments and reduce the need to manually type card information.

Stripe’s payment data, combined with the subscription revenue data myFICO could now access from Billing, gave the company much more information to work with. myFICO uses the Stripe Dashboard to view up-to-the-minute sales trends, dispute and decline trends, and fraud rates. It also uses Stripe Data Pipeline to send all that data to its Amazon Redshift data warehouse, with no need to build its own API integrations.

Meanwhile, Stripe Tax seamlessly replaced myFICO’s previous tax solution, allowing the company to calculate, collect, and report tax on transactions with a single integration. Using the Stripe platform also allowed myFICO to integrate Stripe Radar, which uses AI to automatically detect and block fraud. This now helps myFICO stay protected from unusual changes in fraud patterns.

Results

myFICO gains increased reliability with Stripe

Stripe’s platform offers 99.999% uptime—a big improvement over myFICO’s previous provider. “We’ve seen Stripe’s platform be much more reliable and stable than what we were working with previously,” said Smith.

50% reduction in subscription billing issues with Stripe Billing

The Billing API makes it easy for myFICO to manage recurring billing, with features such as the ability to pause and unpause; prorated upgrades and downgrades; the ability to update subscription pricing or payment methods; and the option to use webhooks to grant subscription benefits and features. Since switching to Stripe, myFICO has seen a major reduction in billing problems.

“We’re using fewer resources on our team than we were with our previous solution, because with our previous solution, we were always uncovering or cleaning up a problem,” said Smith.

Billing issues have reduced by half, resulting in fewer call center contacts, disputes, and customer complaints.

Authorization rates increase by one percentage point

myFICO conducted A/B testing comparing authorization rates on Stripe to those with its former provider. Stripe’s optimizations have led to an authorization rate that is consistently one percentage point higher than what myFICO was achieving previously—a significant improvement in involuntary churn.

Digital wallets boost mobile conversion rates by 10%

Adding Apple Pay and Google Pay increased myFICO’s conversion rates on mobile by 10%, and today, Apple Pay represents 18% of all payments. Combined, Apple Pay and other digital wallets make up 20% of all transactions.

Improved data and reporting

Smith is a particularly heavy user of the Stripe Dashboard. “My Stripe Dashboard is always open,” he said. “It’s super helpful at the executive level to have that kind of real-time summary data.”

After turning Data Pipeline on, FICO’s data science team has built additional custom reports using Stripe data for the company’s finance and business intelligence teams in its Amazon Redshift data warehouse. Now, the finance team can easily reconcile accounts, and the BI team can validate business decisions.

An extra layer of fraud protection

Given its role in providing consumer credit information, myFICO has robust systems in place for authenticating customers’ identities. Radar provides an additional layer of protection, helping ensure that myFICO continues to experience what Smith says are “extremely low” levels of fraud.

“When we look for partners, we look for companies like Stripe that are highly reliable, trusted, and secure—that comply with laws and regulations around security and data privacy,” said Smith. “That’s important to protect our consumers’ information and also to help protect our brand.”