PayNet announces the release of the PayNet MasterScore which is now available on the Credit History Report to help Canadian equipment finance lenders enhance their credit granting process. PayNet MasterScore is the most predictive credit score ever developed from pooled credit data for commercial equipment financing, and is applicable for the full range of borrower industries and equipment types being financed today.

The score was developed by a group of credit professionals and mathematicians using PayNet’s data pool of equipment loans and leases combining traditional credit expertise with cutting-edge modeling of the complex drivers that most impact the payback performance of term loans and leases. And unlike many other models, the PayNet MasterScore was built using data from the expansion and contraction phases of the U.S. business cycle, to help it better predict outcomes in both good times and bad.

The development process for the PayNet MasterScore considered several hundred potential variables, ultimately resulting in the selection of 50 unique variables meeting the dual criterion of producing superior predictive power, while paralleling the practices and principles of traditional credit underwriting. The model includes specialized scorecards for major industry segments, such as Transportation, Construction, Agriculture, Healthcare and Retailer segments.

While most other commercial credit scores focus almost exclusively on an applicant’s delinquency history, the PayNet MasterScore was developed using such an extraordinarily large sample of prior transactions that it was possible to take advantage of a wide variety of attributes and subtle clues that are in fact very predictive of future performance.

Besides delinquency and changes in patterns of delinquency, the model considers the applicant’s time in business, life cycle stage, business size, industry, borrowing experience, financing practices and paydown among other factors.

“The PayNet MasterScore validates well for the Canadian commercial equipment finance market. Because the PayNet MasterScore was built using comparable term-debt data, it is not surprising that this model’s statistics proved to be highly predictive for Canadian lenders,” says Anthony Zambon, Director, PayNet Canada.

PayNet, Inc. Canada is the premier provider of risk management tools and market insight to the commercial credit industry, collecting real-time loan information from leading Canadian lenders and turning it into actionable intelligence. The company's proprietary database -- updated weekly -- is a growing collection of commercial loans and leases, worth over $34 billion. Using state-of-the-art analytics, PayNet converts raw data into real-time market intelligence and predictive information that subscribing lenders use to manage risk, lower operating costs, originate more loans and improve their business strategy. The company is based in Toronto, Ontario. For more information, visit paynetonline.ca.