The new direct licensing program from $FICO is a HUGE change, whereby resellers can calculate and distribute FICO Scores directly to customers. Both pricing models announced by FICO represent a price increase.

FICO introduced a new performance model whereby it will receive a $4.95 royalty (which is a 50% reduction in average score fees into the tri-merge resellers due to the elimination of the credit bureau markup). In addition, there's a funded loan fee of $33 per borrower per score when a FICO-secured loan is closed. It's thus a success-based model whereby FICO is paid a higher fee but only if the loan closes, relieving a key pain point for IMBs that are operating on razor thin margins whereby every credit pull on a failed loan application eats into their profitability.

The per-score only pricing model is priced at $10 to FICO, mimicking the existing $4.95 royalty + bureau markup of ~100%. But instead of half of the $10 going to the credit bureaus, the entire $10 will go to FICO under this new arrangement. In both instances, the reseller will need to participate in the direct licensing program, and they have the option to continue working with the credit bureaus.

With these new pricing models, FICO will either get a 100% price increase, or an incremental $99 fee in a closed loan tri-merge (or $198 for a dual borrower loan).

To the extent that this new program gets traction, this could lead to a very material uptick in revenues and EPS in FY26 and beyond.

We explore $FICO in detail in our 16k word report, where we break out the FICO and credit bureau economics for a typical credit report in great detail.