The Creditinfo Predictor (CIP)

The Creditinfo Predictor (CIP) is a statistical Credit Score that evaluates the probability of default within the next twelve months of Icelandic businesses. The CIP is an important tool throughout the customer lifecycle from the point of acquisition to collections. Subscribers can look up the CIP Score of Icelandic companies by using the front office web application

Distribution of Icelandic businesses by risk categories

Chart.

About the CIP Score

The CIP Score groups businesses into one out of ten categories where one represents low risk and ten the greatest risk, with each category providing a different probability of defaulting. It also includes information on the historical Score, major statistics and comparison with other businesses in the same size category and age group.

Content

Risk category
Historical data
Industry comparison

Benefits of using the CIP

The Score is particularly useful when making a decision on doing business with new and current customers in order to minimise risk.

Ensures that a business decision is not based on a subjective evaluation but instead on objective information from an impartial source.

Loan quality increases and the probability increases of a lender recovering their loans on due date.

Is the CIP Score calculated for all Icelandic businesses?

CIP Score is calculated only for businesses of the following legal forms: limited company (Ltd.); private limited company (Pvt.) and cooperative (Coop.)

What is the CIP Score‘s methodology based on?

The CIP Score is designed by Creditinfo Decision, an associate company of Creditinfo‘s, which specializes in consulting and the design of mathematical models for managing loan risks. The development and construction of the mathematical model has been ongoing since 2001. Reliability tests have revealed that the model‘s predictive ability is very high, with its conclusions being among the best Creditinfo Decision has observed, compared to Iceland‘s neighbouring countries.

What does each CIP Score category stand for?

Rating	Definition
1	Outstandingly little risk
2	Very little risk
3	Little risk
4	Relatively little risk
5	Medium risk
6	Risk
7	Greater than normal risk
8	Much risk
9	Great risk
10	Defaulting is very likely