It seems that credit unions favor using older FICO scoring models than banks do.
Does anyone have a handle on why that is?
Interesting question, SJ! Curious to hear what people say. I assume you are including under the rubrik of "bank" all big for-profit credit card issuers, even if they are known primarily for their cards and not as a place to have savings and checking accounts. Amex, for example. I think they use FICO 8, right?
I do know that Wells Fargo is an exception to the rule you are suggesting. They use really old FICO models. FICO 98 if I remember right.
1) Perhaps the older products are cheaper to subscribe to or to implement technologically, and good enough;
2) Credit unions tend to be more conservative in their loan underwriting than for-profit banks, so perhaps they are hesitant to adopt less-tested (and probably more forgiving) models
Before my small branch was bought out by a large, local CU, they used V3 TU for personal loan and CC app's. It was pretty sweet, lol.
Once a score is developed, the creditor must evaluate what it means.
That requires an understanding of scoring model that created it.
Shifting to a new model requires retraining of employees on the affect of using any new model on the resulting score.
Smaller creditors may not wish to incur such costs.......
Amex uses EX-08 as their base score, but I bet they add their own special sauce to it. Basically, I think they use an internal score. Chase is known to use CARS for credit cards. US Bank uses TU-04 BE. Cap1 primary score is EQ-04 scores. And as has been mentioned WellsFargo is at EX-98 BE. It is time consuming and expensive to evaluate a new credit model. It isn't just small CUs that haven't updated to the newer models.