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Breaking News.

A new credit scoring system aims to help those who have sparse — or no — credit history, by taking into account payments like cell phone and cable bills. Until now, those things could hurt your credit, but not help you.

Fair Isaac Corp, the company behind FICO scores, unveiled a new scoring method that takes into account payment of telecommunications and utility bills, as well as property records. “We want to observe those consumers that have been paying, for example, their mobile, landline and cable bills responsibly,” said Dave Shellenberger senior director, Scoring and Predictive Analytics at FICO. “We know that these can indicate good future payments for other types of credit options.”

Under traditional FICO scoring methods, missed payments on these bills can negatively impact a score, but on-time payments don’t usually translate on the three main credit reports, said Gerri Detweiler, director of consumer education for Credit.com.

There are currently 53 million “unscorable” people in the U.S., according to Shellenberger, and the new credit score can be applied to 15 million of them. Many of them include young adults, immigrants and those who shun credit cards. “We are seeing significant demand from lenders who are very interested in extending credit to more consumers, particularly the under-served and under-banked,” he said.

Source: CNN/Money