Equifax Inc (EFX) Q3 2020 Earnings Call Transcript

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Equifax Inc (NYSE:EFX)
Q3 2020 Earnings Call
Oct 22, 2020, 8:30 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good day, and welcome to the Equifax Third Quarter 2020 Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Dorian Hare. Please go ahead.

Dorian HareSenior Vice President, Investor Relations

Thanks and good morning. Welcome to today’s conference call. I am Dorian Hare. With me today are Mark Begor, Chief Executive Officer; and John Gamble, Chief Financial Officer. Today’s call is being recorded. An archive of the recording will be available later today in the Investor Relations section in the About Equifax tab of our website at www.equifax.com. During the call today, we will be making reference to certain materials that can also be found in the Investor Relations section of our website under Events and Presentation. These materials are labeled Q3 2020 Earnings Release Presentation.

During the call, we’ll be making certain forward-looking statements to help you understand Equifax and its business environment. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from our expectations. Certain risk factors inherent in our business are set forth in filings with the SEC, including our 2019 Form 10-K and subsequent filings. Also, we’ll be referring to certain non-GAAP financial measures, including adjusted EPS attributable to Equifax and adjusted EBITDA, which will be adjusted for certain items that affect the comparability of our underlying operational performance. Certain revenue variances referred to you on this call are based on adjusted revenue from the third quarter of 2019. These non-GAAP measures are detailed in reconciliation tables, which are included with our earnings release and are also posted on our website.

Now, I’d like to turn it over to Mark.

Mark W. BegorChief Executive Officer

Thanks, Dorian. Good morning, everyone, and thanks for joining our third quarter earnings call. Businesses and consumers around the world continue to face challenges brought on by the COVID-19 pandemic. I hope you and your families are continuing to be safe and managing this unprecedented environment. At Equifax, we continue to make the health and safety of our 11,000 employees the top priority.

Turning first to the slide deck, on page number 4. Before I cover our very strong third quarter performance, I wanted to recap our focus over the past three years to transform Equifax to drive revenue growth, margins and cash in the future. Today, we saw unique industry and vertical customer and consumer challenges through our differentiated data assets and best-in-class advanced analytics. Most of our differentiated and — Our most differentiated and most valuable data asset is our TWN income employment data. We are building an industry-leading global native — cloud-native technology footprint, enabled by best-in-class cloud-native tool to leverage our new cloud-based single data fabric. We’ve taken an industry leadership position in data security by changing our culture, our technology solutions and governance to ensure customer and consumer data to safer than it has ever been before. We’re always — we’re obviously focused on a customer-first mentality and we have a market-leading position in 25 countries. And building into Equifax, we are executing on our $1.5 billion cloud data and technology transformation, cloud-native data fabric and our legacy application to the Google Cloud. We’re ramping up our investments in innovation and product resources to drive new product acceleration by leveraging our cloud investments. We’re strengthening our differentiated data portfolio with new unique data assets that complement our new consumers. We’re leveraging advanced analytics, our patented AI technology and cloud-native technology to deliver multimedia solutions. And we differentiate our business support portfolio by acquiring new capabilities and entering new areas of growth.

Turning now to Sliide number 5. The COVID pandemic has accelerated key market macros that are positive for Equifax and for the industry. First, in our data-driven economy, it’s clear the deeper insights from comprehensive data sources, like the U.S. consumer product database at Equifax, and the use of multiple alternative data pop types are critical for risk management, customer prospecting, employment verification and array of other activities engaged in by our customers. More differentiated data was a positive macro prior to COVID-19. These economic impacts of the pandemic have only accelerated this trend around differentiated data. Differentiated data and analytics are more valuable than ever to our customers. Second, providers of credit are increasingly delivering real-time advance and utilize artificial intelligence and machine learning to deliver incremental [Indecipherable]. This trend has been accelerated during COVID, including instances where fraudsters have expanded efforts around fraud account takeover or activities such as loan stacking. Identity and fraud solutions are increasingly valuable. Third, consumers, especially those in the digital age, have expectations with their financial and workplace interactions function digitally. We’ve seen this trend toward digital acceleration in current COVID environment, as face-to-face interactions have become increasingly rare. And last, fintechs and alternative lenders are dimly taking taking share of wallet from traditional financial institutions. We’ve seen this trend challenged somewhat in the near term due economic pressures, including disruptions in capital flows. We expect it will reaccelerate as we move into 2021.

The Equifax team is laser-focused on delivering solutions to help our customers meet the challenging economic demands caused by the COVID-19 pandemic. Our new cloud-native data and applications are delivering integrated data solutions that we were unable to execute on in our legacy environment with unprecedented data currency and speed. We [Indecipherable] alternative data assets toward the creation of trended insights that can better help our customers manage in this environment with the consumer credit profiles that are complicated by unemployment, salary reductions, furloughs and low accomodations [Phonetic].

Our new cloud-based Luminate identity and fraud platform uses these advanced analytics, along with machine learning and data orchestration, providing risk managers with greater insights to better manage fraud. And our solutions enable organizations across industries to adopt the new reality of using digital solutions to interact with their customers. While there’s not a lot of dealership looking to convert online browsers to online purchasers, stepping from the dealership or credit union looking for ways to support members who are operating with reduced branch footprint, Equifax solutions help organization of all types to drive new digital interactions. The COVID recession has accelerated key market macros around the value of broader data assets and real-time decisioning that will benefit Equifax in the future.

Turning to Slide 6, with highlights how Equifax go beyond the standard credit report to give lenders, employers, marketers and other service providers a whole, more complete 360-degree picture of our consumers’ financial life to enhance decisioning. We are working with our customers to leverage the traditional credit files. The lenders are eagle eye on to understand the financial profile of candidates for loans and services. Instead of focusing only on financial activity over the past three to six months, our trended data and analytics allow lenders look at delinquencies over an extended period while closely monitoring indicators of financial distress such as utilization increases and loaning combinations. We estimate that this deeper view of traditional credit reports may allow nearly 4 million consumers who have recently moved down from prime and super-prime product categories due to credit policy tightening to move back up. Consumers that may be good candidates for cards and for personal loans may otherwise be overlooked as lenders execute the traditional recession playbook. Even more importantly, alternative data in the form of Equifax’s unique TWN [Indecipherable] information is becoming increasingly critical as uncertain job market impacts underwriting and the ability of consumer to repay the loan. Unique data we provide helps lenders and consumers together to verify that a borrower is employed, when a credit decision is made. The do-it-yourself alternative requesting hard copy employment and income verifications could lengthen process workflows and cannot be verified. We estimate that the addition of TWN income and employment data into credit decisioning can move more than 7 million consumers up into prime and super-prime category, so they can receive larger loans and other services with renewed lender confidence. Telco, utility, bank transaction and commercial data are further examples of Equifax’s unique and differentiated data sets. Our cloud technology transformation is delivering a single data fabric that combines our multiple databases into one environment to enable more nimble innovation, insights and analytics, while at the same time enhancing regulatory compliance. We have an incredible appetite for new differentiated data. We believe that more data delivers better decisions for our customers. I hope this gives you a strong sense of our broad range of strategic initiatives, as we are transforming Equifax for the future.

Turning now to Slide 7 and our third quarter financial results. Equifax continued with very strong performance again in the third quarter. I’m very encouraged by the resiliency and strength of Equifax and our teams around the world in view of challenges of COVID to help our customers, partners and consumers. We are operating more effectively and efficiently with more energy and momentum than I’ve seen since I joined Equifax. And I believe we’ll be a stronger and more resilient organization when this global pandemic is over. During the third quarter, we saw a very strong revenue performance, particularly at Workforce Solutions and USIS, with broad-based improving revenue trends, resulting in strong cash generation and EBITDA margins, while we continued to make incremental investments in technology, new products, innovation and security. Revenue growth of 19% was the highest quarterly growth in our history and we pushed $1 billion of quarterly revenue for the first time in Equifax’s history. All huge milestones. I’ll talk more in minutes about our financial results.

We continue to make proactive customer collaboration a key priority in order to drive engagement, deal pipelines and new product innovation. During the quarter and past several weeks, I’ve been engaged with our key customers. This is the most challenging environment they’ve ever fixed. Broadly, data is more valuable today than ever and our unique data asset called TWN and advanced analytics are critical in helping our customers navigate through this pandemic. We continue to take advantage of our strong cash generation to accelerate our cloud-native technology transformation investments. Under Bryson Koehler’s leadership and with the support of thousands of technology team members, we are making continued strong progress on our $1.5 billion technology transformation and we are seeing new customers accessing our cloud-native solutions each week as our migrations accelerate. We’re also continuing to expand our investments in resources around innovation of new products that are helping our customers manage in today’s challenging environment, but also with an eye on beyond the pandemic. Our transformation into a product-led organization focused on innovation and enabled by best-in-class cloud-native data assets and world-class technology is becoming more real every day and will power our business in 2021 and beyond. Our team’s strong execution and outperformance in the third quarter is another very positive step forward for Equifax.

Turning to Slide 8. Our financial results for the third quarter were strong and broad based. Revenue of $1.07 billion was of 19% on a reported and local currency basis, which is well above our expectations and the framework of 10% to 12% that we shared with you in early September. That may contribute less than 1% in the quarter. Our growth was again powered by our U.S. B2B businesses, USIS and Workforce Solutions, which had a combined revenue of a very strong 32.5% and combined adjusted EBITDA margins of over 50%. Workforce Solutions continued their exceptional performance driven by the value between database, with revenues up 57% in the quarter, while generating EBITDA margins of 58%. This marked us into Workforce Solutions second consecutive quarter of 50% plus revenue growth. The USIS also exhibited strong revenue growth of 15%.

Our strong U.S. B2B business performance continue to be powered by our focus on growth and our differentiated data assets. U.S. mortgage revenue was up almost 19% compared to the third quarter of 2019. U.S. mortgage market inquiries are proxy for the overall mortgage market growth were up 51% in third quarter, driven by strength in both the new purchase and refinancing mortgage volumes. The driver of our U.S. B2B business’s substantial outperformance versus the market continues to be Workforce Solutions, where mortgage revenue more than doubled for the second consecutive quarter in a row. This is driven by the value that our customers in place and [Indecipherable] data, the rollout of new products, the addition of new customers, improved customer penetration and expansion of our TWN data reference. U.S. mortgage revenue growth of 57% also outpaced the market by 600 basis points. Our unemployment insurance claims business grew over 70% in the quarter with revenue of $50 million. In the third quarter, Workforce Solutions processed about 3.4 billion initial unemployment claims, which is down from 7.5 million additional claims in the second quarter. Workforce Solutions continues to process roughly one in five U.S. initial unemployment claims. We expect unemployment claims to continue above 2019 levels in the fourth quarter, but at a reduced level compared to the third quarter.

Excluding growth from unemployment claims, which we would not expect to recur in 2021, Equifax revenue growth was up a very strong 17% in third quarter and is up over 12% year-to-date. Revenue growth drove adjusted EBITDA to $391 million, up 29%, with a 274 — a 270 basis point expansion in our margins to 36.6%. We prudently balanced cost control, while making targeted investments in our cloud transformation, new products and data and analytics. Adjusted EPS at $1.87 a share was up a strong 26% despite incurring increased depreciation and amortization and incremental cloud cost of $0.15 a share and increased expense — interest expense of $0.06 per share from our second quarter onto offering. This exceeded our expectations in the framework of $1.50 to $1.60 we shared with you in September. USIS revenue of $386 million was up a very strong 15% the third quarter, with the M&A contribution less than 0.5%. Total USIS mortgage revenue of $179 million was up 57% in the quarter as both purchase and rebuy transactions remained strong throughout the quarter and better than our expectations of up about 45% from our call last month.

Non-mortgage revenue also strengthened in USIS sequentially in the quarter at down 6%, up from down 7% in the second quarter. Importantly, we saw substantial improvement in non-mortgage online revenue, which was down only 5% as compared to almost 10% decline we saw in the second quarter. We saw a very good sequential improvement in banking, insurance, rental and direct to consumer, with insurance turning from down double digits to up double digits in the quarter. We are starting to see signs of customers restarting origination efforts with several major FIs revenue, up versus 2019 for the first time in the pandemic, which is a positive sign for the futurebatch. In September, we saw a positive growth in both Insurance and Direct to Consumer, which although still negative, we saw improvements in banking and auto, both of which had only single-digit declines.

Financial Marketing Services revenue, which is, broadly speaking, our offline or batch business, of $46 million was down 9%, consistent with our expectations. Marketing-related revenue, which represents just under 40% of FMS, continued to be down significantly, but did show some improvement as we moved through the third quarter. Risk decisioning, which includes portfolio [Indecipherable] activities and represents about 40% of FMS revenue, was down slightly due to a large one-time project last year. Identity and fraud related revenue, which represents about 20% of FMS, was flat. I’m very encouraged by the progress of [Indecipherable] USIS teams continue to make, especially during these challenging economic times. They are competitive commercially and [Indecipherable]. We continue to see very strong new deal pipeline growth in USIS, with total pipeline value up over 30% versus last year, driven by growth in the volume and average size of our USIS pipeline opportunities. Larger deal opportunities are very positive signs; we hope to accelerate USIS revenue growth. USIS adjusted EBITDA margins of 46% were up 160 basis points from last year, by 180 basis points sequentially. The improvements, both year-to-year and sequentially, were driven principally by the significant growth in high-margin online revenue.

Turning now to Workforce Solutions. They had another exceptional quarter with revenue of $377 million, up a very strong 57%. Year-to-date revenue was already over $1 billion at Workforce Solutions. Rudy Ploder and EWS team continue to leverage broad structural growth drivers, including new products, penetration, pricing, new verticals and record additions to fuel their above-market growth. EWS remains our most differentiated business, particularly in this unprecedented consumer environment where our TWN income employment data is immensely valuable. Verification Service revenues at $301 million was up 63% versus 2019. Verification Services mortgage revenue more than doubled for the second quarter in a row, growing more than 80 percentage points faster than the 51% growth we saw in the mortgage market credit in force in the third quarter. Verification Services non-mortgage revenue was up about 4% in the quarter and slightly outperformed our expectations. Similar to the second quarter, we continued to see growth in government healthcare as well as in the auto vertical, as we increased penetration of TWN. During the third quarter, we saw significant recovery in talent solutions, reflecting both increased U.S. hiring and the rollout of new products. Consistent with second quarter, debt management continues to be very soft. Employer Services revenue of $76 million increased 37% in the quarter, driven by our unemployment claims business, which had revenue of $50 million and was up 70% compared to last year. Adjusting for the $20 million of incremental UC claims revenue in the quarter, Employer Services was flat with revenue growth in 9 — I-9 and onboarding services that was driven by the acceleration of I-9 anywhere solutions, offset by declines in our tax credit business. Transaction activity in our I-9 and onboarding products improved through the third quarter and sequentially versus the second quarter, driven by new hiring activity with our customers. Many of the large retail shipping and e-commerce companies utilize our I-9 onboarding products. In addition, we are seeing a positive shift to our new remote I-9 products with new customer wins. Strong EWS verified revenue growth resulted in adjusted EBITDA margins in Workforce Solutions of 57.8%, a 900 basis point expansion from the prior year.

Turning now to International. The revenue of $218 million, we’ve done 5% on a constant currency basis. A substantial improvement from the down 15% in second quarter and better than our expectations as shelter-in-place orders were lifted in many markets and economic activity resumed. Asia-Pacific, which is principally our Australia business, had a very good performance in the quarter, with revenue of $80 million, about flat in local currency versus last year and better than the down 5% we expected earlier in September. Australia consumer online revenue was down 5% versus last year, a significant improvement from the down double-digits we saw in second quarter. Our Australian commercial business combined online and offline revenue was up 1% in the quarter, again a nice improvement from the prior period. Fraud Identity was also up over 15% in the third quarter versus the down 12% in second quarter. [Indecipherable] improvement in offset declines in consumer marketing services, our consumer offline business in HR Solutions. Consistent with second quarter, they continue to be down versus last year. New Zealand revenue was down just over 10% in the quarter, significant improvement from the down 25% in the second quarter. European revenues of $59 million were down 13% in local currency in the third quarter. Our European credit business was down about 7%, with Spain performing slightly better than the U.K. In the U.K., consumer online revenue was down just over 10%, a significant improvement from the down 20% we saw in second quarter. Analytical and Decision Solutions revenue was almost flat in the quarter, a significant improvement from about — down about 20% in second quarter. Combined consumer online and analytical decision solutions represent about 70% — 75% of our U.K. CRE business. Similar to the U.S., our consumer offline business continues to show significant declines due to reduction in the economic activity and credit originations. Banking revenue driven by new wins with the top 5 U.K. banks was up over 25% in the quarter. Our U.K. banking team is seeing real momentum. Our European debt management business declined 20% local currency, in line with our expectations and principally driven by government-enacted policies that continued the temporarily fall in debt collections due to COVID-19. U.K. government’s debt placement activities restarted in August. We expect fourth quarter debt management revenue to improve meaningfully, as September debt placements were up 5x versus pre-COVID levels.

Turning to Latin America. Their revenue of $40 million decreased 6% local currency in the third quarter, better than the down 9% we expected earlier in the quarter. Importantly, our Latin American revenues were much better than the down 14% we saw in the second quarter. In the quarter, July, our largest country in Latin America delivered positive revenue growth. And our Argentina and Paraguay businesses showed significant improvements in the second quarter, down about 4% in the quarter versus 2019. These markets continue to benefit from the resumption of economic activity, expansion of Ignite and migration of customers to our global cloud-based Interconnect SaaS decisioning platform. We’re also seeing the benefit of the strong new product introductions over the past three years in the region,

Canada revenue of $39 million was flat to local currency in the third quarter, a significant improvement from the down 13% in second quarter and in line with our expectations from our September call. Consumer online and commercial were both down about 5% in the third quarter and both were substantial improvements, almost 20% declines in the second quarter. Analytical and decision solutions were about flat in the quarter. Again, substantial improvement from the second quarter. We delivered nice growth in Canada in our ID and fraud business and property service businesses. It, combined with improved performance of the other segments, allowed us to improve to flat in the third quarter.

International adjusted EBITDA margins of 32.3% were up 130 basis points from last year despite the decline in revenue, principally reflecting benefits from cost actions we’ve taken in 2019 and strong expense management this year.

Turning now to Global Solutions revenue, which was down 2% on a reported and local currency basis in the quarter. Our Global Consumer Direct business was up 6%, their highest growth since 2017. Our North American Consumer Direct business revenue was up a solid 6% versus 2019, while the U.K. Consumer Direct revenue was about flat. Importantly, we continue to see sequential subscriber growth in the U.S. and Canada, our two largest markets. Based on a continuation of these trends, we expect our Consumer Direct business to show positive revenue growth in the fourth quarter. Bev Anderson and the GCS team have done a good job, returning our Global Direct business to a growth mode. Our remaining GCS businesses principally are partner businesses, as well as our benefits channel an event-based businesses decreased about 10% in the quarter, in line with our expectations. We delivered 11% growth in our benefits channel and event-based businesses. But this growth was more than offset by declines in our U.S. region partner business, as originations continue to be soft in the third quarter. GCS adjusted EBITDA margins of 24.8% decreased 10 basis points compared to the prior year period, due to increased marketing spend to drive future direct revenue and lower lead generation revenue offset by one-time setup costs incurred during the third quarter of 2019, related to a new multi-year contract.

Slide 9 highlights the acceleration of revenue growth over the last several years and quarters, broken down between the growth drivers from the extraordinary UC claims revenue in 2020 from high unemployment and a strong U.S. mortgage revenue market, to help you look through the impact of the strong market factors to the underlying Equifax quarter growth. As we discussed earlier in the third quarter. Equifax grew 19% overall with 200 basis points of that growth for UC claim revenue and 11 points of Equifax revenue growth from the strong U.S. mortgage market. We are very pleased with the 6% core growth, with strong sequential growth versus the minus 2% in second quarter, particularly with the headwinds from the COVID recession. Equifax is clearly outperforming our year expectations in the global recession. The impact of the strong U.S. mortgage market is highlighted in purple and reflects growth driven directly by the strong underlying U.S. mortgage market. To be clear, this is not the growth of Equifax U.S. mortgage revenue, but is instead only growth directly attributable to the U.S. mortgage market itself that we estimate based on mortgage market credit inquiries. During the third quarter, 11 points of Equifax’s 19% growth was from the strong U.S. mortgage market. The impact of the extraordinary UC claims growth in 2020 is highlighted in blue. We are providing this given the dramatic unusual growth in the year we are seeing in 2020, that we expect to normalize over time. Equifax’s core growth has increased and reflects the resiliency and breadth of our business performance in the global recession. Essentially, this has put some of the growth in our U.S. non-mortgage businesses, our international businesses and GCS and our — and growth in our U.S. mortgage businesses above underlying mortgage market growth. Excluding the impact of the U.S. mortgage market and UC claims, Equifax core growth has expanded from 2% to 3% in 2018 and 2019 during the global financial crisis to 5% in the first quarter and now 6% in the third quarter, while we’re still in the middle of the COVID pandemic. This performance reflects the resiliency and breadth of the Equifax portfolio.

As I will cover on the next slide, it’s important to recognize that in the third quarter, a significant portion of the 6% of Equifax core growth had been driven by our outperformance in our U.S. B2B mortgage vertical, powered by Workforce Solutions core growth, which was a strong 30%, and USIS which was only down 1% on a core growth basis. This ability to substantially outgrow the underlying market is core to our business model and a substantial strength that should continue to provide significant benefits through the balance of 2020 and into 2021. Equifax is dramatically stronger in 2020 versus the 2008-2009 recession, with revenue up 19% in the quarter and 12% in second quarter versus down 6% during the global financial crisis, again reflecting the strength of today’s Equifax portfolio.

A continued strategic focus and strength of Equifax is our deep and broad array of product and solutions for the U.S. mortgage market and ability to consistently outgrow the underlying market. Slide 10 highlights this for our U.S. B2B businesses, Workforce Solutions and USIS. The Workforce Solutions and USIS have consistently outgrown the underlying U.S. mortgage market. The driver of the acceleration of this outperformance over the past several years has been the tremendous growth in Workforce Solutions mortgage revenue, which exceeded mortgage market growth rates by our 20 points in 2019, accelerating to about 18 points of our performance this year. The key drivers of the strong Workforce Solutions performance includes increased market penetration, which by this we mean both an increase in the percentage of mortgage applications for which the underwriter requests and income and employment verification from Equifax and an increase in the number of times that mortgage underwriter requests an income or employment verification during the application process. Both of these drive increased trade inquiries. As we view U.S. mortgage market inquiries as a proxy for the overall market, an important metric we track is TWN inquiries as a percent of USIS credit inquiries. In third quarter, this metric for the first time exceeded 50%, where we had one TWN mortgage marketing inquiry for every two USIS credit mortgage marketing inquiries. This metric has been growing substantially over the past three years and has more than doubled since early 2018. However, only 50% of it shows that we have a lot of runway ahead of us to reach the same utilization for TWN as the credit file. We are actively working with our customers, which continue to drive penetration through both expanded selling efforts across our customer ecosystem and increasing customer system-to-system integrations. Second is increased fulfillment rate. This is the percentage of times we receive a mortgage inquiry that we can fulfill and is driven by growth in the TWN database. While we have good scale of over 50% of the non-farm payroll database, we only fulfill roughly 50% of our inquiries. As we add records, we are immediately monetized, which provides real leverage for Workforce Solutions. Adding in TWN contributors and records is a priority for the CWS team. And third is new products. We continue to introduce new Workforce Solutions products that provide greater value to our customers in terms of depth of data and frequency of poles with higher price points by margins. We expect NPIs to accelerate Workforce Solutions from the addition of new product resources and leverage from the cloud transformation. Workforce Solutions is clearly our most powerful business. Slide 11 shows their above-market strong performance, which is highly accretive to Equifax revenue growth, margins and cash flow. Through third quarter, overall workforce revenue growth of $332 million or 48% through a 13 points of Equifax revenue growth and Workforce core revenue growth of $163 million contributed 6 points of Equifax core revenue growth versus last year. The impact on Equifax EBITDA was even more powerful, with Workforce Solutions delivering $572 million of Equifax EBITDA or 44% of our total EBITDA through the third quarter. Equifax is a powerful business and an important driver of Equifax results 2020 and in the future.

In the Slide 12, you can see the continuing growth in our TWN database, which has been a significant driver of this value to our customers and the growth of Workforce Solutions. In the third quarter, we continued to add TWN records and delivered new TWN record growth of 6 million active records in the quarter, even in the high unemployment environment, which drove TWN database to over 111 million records, up from 105 million we had at the end of both first quarter and second quarter. TWN records were up a strong 20% versus 2019. We also get a significant milestone in the third quarter with contributors surpassing the 1 million level. This is a million companies in the United States that are contributing to payroll records at Equifax, up from 64,000 a year ago, which has moved to TWN database deeply into small and mid-market companies. With TWN database now providing information on over 88 million unique individuals, firmly over half of the U.S. non-farm payroll, we view this as a catalyst for Workforce Solutions, given the increasing leverage and uniqueness of the data. As we discussed previously, the Workforce Solutions team is expanding their focus on reference beyond just W2 payroll into areas like 1099 employees and gig economy contention income. The increasing depth of the TWN database, with now over 415 billion total records, has the additional benefit of increasing the completeness of an individual’s job history that we have in the database. This also significantly increases the value of unique TWN data for both credit decisioning as well as in talent solutions and other applications. As a reminder, we generate almost 20% of our verification services revenue from inactive records that we have built up over the past decade, which helps provide a full picture of an individual’s employment history. This also expands the uniqueness and value of TWN versus other sources of income or employment data.

In what has been the most challenging economic and health environment we face in our lifetimes, Equifax delivered exceptionally strong performance again in the third quarter, while investing in our cloud transformation to new products. We are focused on finishing 2020 strong, while investing for 2021 and beyond.

I’ll now turn the discussion over to John to discuss the recent trends of revenue in our underlying markets, as well as to review some other financial items. After John’s discussion, I’ll come back and review our progress on the tech transformation and new products.

John W. GambleCorporate Vice President, Chief Financial Officer

Thanks, Mark. I’ll generally be referring to the financial results from continuing operations represented on a GAAP basis, but will refer to non-GAAP results as well. In the third quarter, general corporate expense was $155 million. Excluding non-recurring costs, adjusted general corporate expense for this quarter was $109 million, up $38 million from 3Q ’19. Corporate pension expenses such as Finance, HR and Legal were down year-to-year, reflecting the cost containment activities we outlined in April. The increase in total general corporate expense is primarily due to higher incentive compensation costs in 2020, due to our strong and improving financial performance. We continue to exercise disciplined cost management across the business, while also continuing to invest in our technology transformation, data and analytics, new products and security. We will accelerate investments in these areas in 2020 and we believe this will deliver accelerated benefits. Outside of these areas, the headcount additions remain at levels below attrition and discretionary spending has been reduced. Across the company, business travel remains at very low levels. For 3Q ’20, the effective tax rate used in calculating adjusted EPS was 21.2% and in line with our expectations. We expect the 4Q ’20 tax rate and the full-year effective tax rate used in calculating adjusted EPS to be around 24%. And 3Q ’20 and year-to-date operating cash flow of $367 million and $645 million were up $532 million and $566 million respectively on 2019. The increases reflect substantial improvements in operating performance in 2020, as well as lower payments for litigation settlements in 3Q ’20 and year-to-date of $341 million and $246 million respectively. The timing of payment of the remaining $347 million to the U.S. consumer restitution fund was principally dependent on the resolution of the fields filed related to this case. At this time, we do not expect to fund the remainder of the settlement until early 2021.

Our liquidity and balance sheet remain very strong. At September 30th, we had $1.5 billion in cash and available borrowing capacity on our bank credit facility of $1.1 billion. As Mark mentioned, our 3Q results were substantially stronger than the implication of the trends through August that we discussed in our September 8th Investor Call. The improved results were predominantly in our U.S. B2B business. Importantly, the improvement was in our U.S. online revenue, with significant improvement in non-mortgage revenue as well as the mortgage. We also had stronger results in International, in Australia and Canada. The strength in the adjusted EPS reflects the margin impact from the stronger revenue in September.

Slide 13 through 15 show details of revenue trends on a local currency basis that we saw in 2Q and 3Q, as well as monthly data for July, August and September. We are also providing a view of the trends so far during the month of October and our implications on 4Q ’20, if they were to continue throughout the quarter. For line items, for which daily trends are not available or not relevant, we did not provide monthly actuals, but did provide 2Q ’20 and 3Q ’20 data as well as an estimate for 4Q ’20. The monthly actuals data provided should be viewed as directional.

Looking at Slide 13, starting at the bottom of the slide, U.S. B2B revenue growth trended very positively in September relative to August and into 3Q ’20 relative to 2Q ’20, with U.S. B2B revenue about 32% in 3Q ’20 year-to-year as compared to the 28% year-to-year growth we saw in 2Q ’20. This was driven by improved year-to-year growth in U.S. B2B online revenue. Mortgage year-to-year revenue growth strengthened significantly in September versus on August and in 3Q ’20 year-to-year in both USIS and EWS. This stronger growth was in the context of the stronger mortgage market we saw in 3Q ’19, when we grew 20% from 3Q ’18. Importantly, online non-mortgage revenue growth trends also improved meaningfully in both September and 3Q ’20. USIS non-mortgage revenue was down only 3% in September and 5% in 3Q ’20 year-to-year, and EWS saw year-to-year growth in online non-mortgage revenue in both September and third quarter ’20. Workforce Solutions unemployment insurance claims business grew substantially year-to-year again and the third quarter of ’20, which had strong growth in UC again in 4Q ’20, up about 30% year-to-year.

The column on the far right of Slide 13 provides a view on year-to-year revenue growth trends through mid-October and the implications on 4Q ’20 revenue of those trends should continue. A few reminders, as we look at those trends. Fourth quarter is seasonally the lowest quarter for mortgage revenue, reducing the relative mix of mortgage revenue and overall Equifax revenue. 4Q ’19 saw very strong growth in U.S. B2B online, about 18% driven by very strong 4Q ’19 online mortgage revenue growth of 34%. Again, starting at the bottom the Slide 13, should the implication of the revenue trends through mid-October continue throughout 4Q ’20, U.S. B2B online year-to-year revenue should continue to be extremely strong with growth rates of just under 30%. Both USIS online and EWS online verification services growth rates will be very strong, but at a level slightly below what we saw in 3Q ’20. Mortgage revenue growth rates will be slightly weaker than in 3Q ’20, reflecting the strength in 4Q ’19 mortgage revenue, particularly in EWS. USIS non-mortgage year-to-year growth rates will be about flat with 3Q ’20 and Workforce non-mortgage is expected to decline slightly versus the slight growth you saw in 3Q ’20. Workforce Solutions employer services year-to-year revenue would become under 15%, as the unemployment insurance claiming business continues the good growth with levels lower than 3Q ’20. Financial marketing services revenue will be down consistent with the levels we saw in the third quarter.

Turning to Slide 14. As Mark discussed earlier, International saw significant improvements in all regions in 3Q ’20, with constant currency year-to-year revenue down only 5%. Trends through mid-October in International continue to improve and should the implication of the revenue trends through mid-October continue throughout 4Q ’20, we expect international revenue to be down only slightly in the fourth quarter. GCS October trends reflect a continuation of those that Mark discussed earlier. In consumer direct, growing total subscribers are expected to lead into a second consecutive quarter of global direct revenue growth in 4Q. As we referenced last quarter, the decline in partner revenue we saw in 3Q ’20 is expected to increase significantly in 4Q, due to decline in the [Indecipherable]-related partner business. We expect the weakness in partner revenue to continue into the first half of 2021.

As with our prior two earnings call and due to the continuing uncertainties in forecasting direction, depth and duration of the recession related to the actions to combat COVID-19, we are not going to provide fourth quarter guidance. However, for prospective on total Equifax 4Q ’20 performance, we will again provide an illustrative fourth quarter framework to help you think about our performance. Please turn to Slide 15. To the extent total Equifax revenue continues at the pace I described earlier, 4Q ’20 revenue would be up about 9.5% to 11.5% or $84 million to $140 million year-to-year, resulting in 4Q ’20 revenue of $990 million to $1.41 billion. Adjusted EPS in 4Q ’20 in these revenue levels could be in the range of $1.40 to $1.50 a share, down slightly from 4Q ’19. Slide 15 also provides a walkthrough, explaining the translation versus 4Q ’19 of the revenue increase to the increase in pre-tax income and adjusted EPS. Importantly, at these adjusted EPS levels, Equifax should deliver over $350 million of adjusted EBITDA in the quarter. This is not guidance, because there is still much uncertainty just to what impact the pandemic will have on the economy, our customers’ business activities and therefore, our revenue earnings. This range provided reflects current variability in trends, not a view of potential quarter outcomes.

As I referenced earlier, trends in Equifax mortgage inquiry volume remain at record levels in the third quarter, consistent with a very strong market data originations. In addition to very strong refinancing activity, the purchase volume has been at record levels in the June through August period, up 20% from last year. And as we referenced last quarter for Black Knight estimates, approximately 18 million households still benefit from refinancing at current average 30-year mortgage rates of under 2.9%. For perspective, current instruments of refinance originations in 2Q ’20 are at under $1 million per month. As Mark referenced earlier, we continue to look to accelerate the completion of our tech transformation, including increasing the investment levels in 2020. At present, we expect 2020 one-time costs related to the Equifax 2020 technology and data security transformation to be above $340 million. We expect capital spending to be about $410 million for the full year. As a reminder, in 2021, we will no longer be adjusting our financial results for one-time costs related to the cloud technology transformation. The one-time technology transformation costs are expected to decline substantially in 2021 and will likely be largest in 1Q ’21, decreasing throughout the remainder of 2021. Those one-time technology transformation costs will impact development expense, D&A and costs. We will continue to disclose these one-time tax transformation costs to allow you to have comparability with our financial results from 2017 to 2020.

And with that, I’ll turn it back over to Mark.

Mark W. BegorChief Executive Officer

Thanks, John. I’ll wrap up with an update on our technology data transformation and our accelerated focus on new products.

Turning to Slide 16. Equifax continues to make very meaningful progress on our cloud-native technology transformation. We’re energized by the revenue, cost margin and cash benefits we expect from our cloud investments. Through our single cloud-native fabric and common cloud — global cloud-based infrastructure, we’ll be able to innovate to develop more robust product solutions and multi-day insights that are portable around the world, enabled by our differentiated cloud-native technology. We’ll be able to unlock new use cases and verticals with our solutions for new and existing customers. Our cloud-based infrastructure will also enable us to accelerate the velocity at which we can develop new products from months to weeks, accelerating the benefits our customers receive from these products and driving our revenue growth. We are already starting to see increased system availability as we move from our legacy technology into the cloud, and we expect this trend to continue. All these on capabilities are table stakes. As a global technology company, we believe that as more customers move to the cloud, the cloud-to-cloud operability will deliver best-in-class systems availability and the customer interaction seamless and faster. And lastly, we’re continuing on our path to be an industry leader in data security. While security is core to everything we do, led by advancements and data governance, we know that data security is a battle that we must fight alongside our industry peers and our customers every day.

Turning to Slide 17. We moved into the final phase of our North America technology transformation with a focus on customer migrations. We’re continuing our progress to migrate our customers into our new cloud-based systems, including our Interconnect, Ignite and API capabilities. As a reminder, this is a common set of services on which we are working to migrate all USIS, EWS and International customers. As we end — As of the end of the third quarter, USIS has migrated over 4,800 U.S. customers and International has completed migrations of about 6,500 customers. For USIS, [Indecipherable] about 4x from [Indecipherable] about 1,200 customers migrating at the end of June. We continue to expect this pace of migration to accelerate in the fourth quarter, with over 10,000 U.S. customer migrations expected by year-end, with the remaining U.S. customer migrations completed during 2021. We continue to adjust our development priorities to add platform capabilities to ease our customers’ ability to easily migrate toward those platforms.

Our progress on the transformation since our last earnings call in July is positive. Initial [Indecipherable] migration to GGP of our major North American exchange data, the U.S. and Canadian consumer agro risk exchanges, The Work Number and NCTUE is principally complete. And we expect to have completed a full migration, including all data ingestion processes, for these exchanges by year-end. This is a big milestone with these exchanges generating about 70% of North America online revenue. We’re also making very good progress of the full migration to GGP of our secondary U.S. exchanges, the U.S. and Canadian commercial risk exchanges, property and data exchanges. These exchanges are expected to be — to complete full migration as we move through 2021. Investments in Europe, LatAm and Australia in deploying cloud-native data fabric in our Ignite, Interconnect, API analytic and decisioning framework are also progressing well. Data fabric is live in six global cloud regions globally. We completed the initial migration of our EID identity validation system in the third quarter and have starting customer migrations, which we expect to complete by year-end. And our Luminate cloud identity and fraud suite is now available to customers in the U.S. and Canada and a new EID cloud-native service is also available for the U.S. as part of our newly transformed cloud [Indecipherable]. Additional data sources will continue to be integrated on a regular basis, as we move forward. We still have plenty of work in progress. We are making strong progress in our cloud data and technology transformation. We remain energized about the future top and bottom line benefits. Our cloud-native data and infrastructure will differentiate Equifax in the marketplace today and will be even more valuable as we complete the transformation.

Slide 18 highlights our expanded new product innovation focus, which is a key component of our EFX 2020 strategy and the next chapter at Equifax. As I mentioned earlier, we are focused on transforming our company into a product-led organization empowered by best-in-class cloud-native data and technology to fuel growth. As we progress through 2020, we continue to make strong progress on our goal to expand our NPI enrollers and are on track to deliver about 110 new products in 2020. Through September, we launched about 85 new products and we have an active pipeline at various stages of the funnel. In the third quarter, we continued to have strong focus on recession-based product launches, including our response recovery product offering, which provide lenders and service providers the data and analytics they need to both care for their customers and ensure the long-term health of their portfolios. Response recovery enabled by our Ignite Market Intelligence Sandbox provide the lenders access to point-in-time in trended consumer insights in order to make better underwriting decisions during a period of economic instability, as well as get the information they need to reach out to support their existing customers already in accommodation situations at other institutions. In USIS, we continue to build on our strengthening and commercial business. In the third quarter, USIS launched B2B Connect, designed to help enterprises that are prospect segment and retain key business clients with intelligence by more than 150 million global companies, including 53 million U.S. businesses and 80 million B2B contacts. B2B Connect is providing an extended omnichannel view of business of companies need to better qualify commercial prospects and improve engagement with existing customers. The commercial B2B product will be further enhanced by data from our recent acquisition of Ansonia, which brings unique commercial leasing data to our already robust set of commercial assets. At Workforce Solutions, we continue to focus on the hiring process as a significant growth opportunity for our business and there are more than 70 million new hires per year in the United States. In the third quarter, Workforce Solutions launched the first — the industry’s first I-9 management service designed specifically as an e-commerce platform and with small and mid-sized business owners in mind. For years, large enterprise businesses have put their trust in the market-leading I-9 management solution from Equifax. Now, with the e-commerce launches of our I-9 starter and our I-9 standard packages, Equifax makes it easier than ever for businesses of any size to manage their I-9 requirements. With automated automated I-9 platform, organizations could have more confidence on their onboarding and I-9 compliance and deliver better on-boarding experience for their new hires. Workforce Solutions also continue to innovate new solutions to support their financial and mortgage verticals in 2020, including our new mortgage trend income and employment in multi-borrower products.

NPIs continue to be an important lever for Equifax growth and a priority for me and the team. We’ve expanded our focus and resources on driving NPI rollouts in 2020 and more recently, with a global focus on products to support our customers during the COVID recession. We will continue to prioritize new products and innovation as we move into 2021 to leverage our cloud-native technology transformation for future growth.

Wrapping up on Slide 19. As John outlined earlier, we’re still unable to provide guidance for the fourth quarter. We still see meaningful uncertainty from the impacts from the COVID pandemic, as cases rise in many markets impacting shelter-in-place orders, consumer confidence and economic activity. There’s also real risk of a second COVID wave and potential increased doubts. We also expect further impacts from unemployment, furloughs and salary reductions. But even in this challenging COVID environment, Equifax is operating exceptionally well. Our strong business model [Indecipherable] in delivering, while investing in the future. As we look forward to the rest of 2020 and toward 2021 and beyond, we are confident on drivers of our business model and [Indecipherable] strategy. Our strong 19% growth in the third quarter affect the breadth and resiliency of the Equifax business model. The strong U.S. mortgage market and UC claims review, delivering incremental revenue margin and cash, it allows Equifax to continue to be aggressive about investing our cloud transformation or spending new investments in innovation, new products in D&A. Our strong results also strengthened our balance sheet, to allow us to focus on accretive M&A. In the third — In our third quarter call, 6% revenue growth, excluding the impact of U.S. mortgage market and UC claims revenue is very strong performance in the COVID environment, with our non-mortgage and International business still pressured in the COVID recession. We expect those markets to recover in the future with the rollout of a broad-based COVID vaccine and as markets recover and economic activity improves. Workforce Solutions is clearly a franchise Equifax business that is strongly outperforming with multiple structural growth levers from the records in products, improving product mix, do verticals and incremental holds, driven by the growth in system-to-system integrations. While the mortgage market is a positive tailwind this year for Workforce Solutions, there’s underlying 27% core growth year-to-date, excluding the impact of UC claims and the mortgage market, reflect the power and breadth of the Workforce Solutions business model. The multiple structural growth levers give us confidence on our ability to drive future incremental value for our customers and future revenue growth for Equifax. And the addition of $6 million TWN records in the third quarter will drive revenue growth in the future. Our new SSA contract, Social Security Administration contract, that will begin generating $40 million to $50 million of annualized revenue starting next year, is another future Workforce Solution growth driver. We are also seeing enhanced and broadened value of unique TWN income and employment data, given the scale and depth of the database.

Turning to USIS, they also had a strong quarter, led by growth in mortgage. USIS [Indecipherable] and winning in the marketplace, USIS revenue is outperforming in the COVID recession, with total third quarter growth improving to down 1%, excluding growth in the U.S. mortgage market. USIS mortgage business continues to outgrow the market with nine points of [Indecipherable] third quarter, up from six points in the second quarter. Importantly, USIS pipelines remains our highest levels since 2017 from a renewed commercial focus and rollout of new products. As we look out beyond the impacts of the COVID and pandemic, we believe that our non-mortgage revenues, which historically represent about 70% of USIS revenue are poised for growth. USIS is competitive and winning in the marketplace. Our International business has a well-balanced portfolio of global businesses, representing over 20% of Equifax revenues, that have historically driven top-line revenue growth through new products and analytics, unlike our U.S. B2B businesses, most of our international markets do not have mortgage businesses and therefore, have not — have seen a larger decline in revenue growth in 2020 from the deeper COVID recessions and more severe [Indecipherable] declines that have also impacted growth. We began to see recovery here in our international markets in the third quarter with Australia and Canada flat versus last year and expect to see continued improvements as economic activity resumes globally.

And last, our GCS direct business is poised for continued growth behind our disciplined investments. Our D2C businesses are improving as we invested new products and marketing and we have 7 million My Equifax members in the quarter, which is a sizable base across all financial products. And I summarize, we’re making very good progress on our cloud transformation and data transformation with significant milestones being achieved on customer migrations acceleration. We are energized about the significant top-line cost and cash benefits that will come to this transformation, including always on stability, speed to market, ability to rapidly new products around the globe, which we expect will help us improve our position in the marketplace. And last, our balance sheet is strengthened in 2020 from our strong performance, allowing us to be aggressive about investing in our EFX 2020 data and technology transformation, new products and data security while looking for accretive bolt-on acquisitions that will add to our strategy. As we continue to deliver above-market results in the COVID recession and focused on investing for future growth, I’m more excited than ever about our future as a market-leading data analytics and technology company.

With that, operator, let me open it up for questions.

Questions and Answers:

Mark W. BegorChief Executive Officer

Thank you. [Operator Instructions] We will take our first question from Kyle Peterson with Needham.

Kyle PetersonNeedham — Analyst

Hey, good morning. Thanks for taking my question. Just wanted to start on the margins. They look really strong this quarter, especially within the U.S. I know those have been kind of marketing up over time. Do you think what we saw in the margin side could be sustainable in more normalized environment, or is there anything like one time that we should be thinking about from this quarter?

Mark W. BegorChief Executive Officer

Yes, it’s a great question. You’ve seen over the last several years, certainly in 2020, strong top-line performance from Workforce Solutions that certainly translated into margin growth. As you know, in our industry and in that business in particular but in all our businesses, incremental revenue growth drives very attractive incremental margins. And we’ve seen a very strong performance in 2020. We expect that business to continue to perform in the future. I don’t think we’re prepared to give any guidance around margins for the future because we can’t do that broadly, but we’ve got a lot of confidence in the Workforce Solutions business given the multiple levers that they have to drive future growth.

Kyle PetersonNeedham — Analyst

Got it. That’s helpful. And then just one follow-up. I know you mentioned that you [Indecipherable] increase, now that you’re kind of about one inquiry and TWN for every two mortgage origination inquiries, what do you guys find as the biggest gating factor to getting — moving that ratio higher? Is that — Does that more like lender awareness of those database, or is it just that you just need to keep pushing the snow ball down the hill and adding more employers and records onto the network?

Mark W. BegorChief Executive Officer

Yeah. It’s less about the employers and records. It’s really what you pointed out. It’s really getting in front of our customers and showing them the value of the product. It’s also driven by new products. As we talked about in the last couple of calls, the Workforce Solutions is rolling out new products that provide multiple poles in a package for mortgage application as one purchase from Equifax. And we see that driving some of the poles. We also see the system integrations being a real driver where we’re getting embedded in our customer workflows, and we’ve got a dedicated team that works on that with our customers to show them the value of the income and employment data. And then, as you pointed out, just getting in front of customers so they understand the limit they get in predictability. If you’re a mortgage originator and you’re going to spend, call it, $4,000 in a mortgage application, when you start that application process, you want to make sure that you’re working with a customer and it is going to be able to be approved. Now, part of that is historically pulling the credit file upfront to understand what the credit profile is of that customer and that’s kind of a common practice today. Increasingly, the more sophisticated mortgage originators are starting to pull upfront the income and employment data, particularly in this environment, understanding where are people still employed and then pulling it multiple times. So, those are just multiple opportunities that the team has and using mortgage is an example. And of course, the same holds in other verticals where we’re seeing particularly as the database becomes almost a catalyst at over — well over 50% of the non-farm payroll. It’s becoming an asset and the hit rates are very valuable in multiple verticals beyond mortgage.

Operator

We will take our next question from Manav Patnaik with Barclays.

Manav PatnaikBarclays Capital — Analyst

Good morning. Maybe I can just follow-up. The mortgage digitalization, I guess, is the big team up and we’ve seen a lot of acquisitions from Black Knight. There’s a whole bunch of stuff going on out there. And I guess besides trying to get more penetration, the way you just described it, like, how do you look at the opportunity with that team and do you have plans with [Indecipherable[ solutions M&A, maybe just some thoughts there would be helpful.

Mark W. BegorChief Executive Officer

Hey, Manav. I apologize, I missed the first portion of the question. Can you just rephrase that?

Manav PatnaikBarclays Capital — Analyst

Sure. It was tied to the theme around mortgage with digitization, I guess, and there’s a lot of opportunity striving from that. And I was just wondering if you had drawn plans for your mortgage business outside of just kind of a little bit more penetration that you just talked about.

Mark W. BegorChief Executive Officer

Yeah. So, obviously, we have a large mortgage business and we’re benefiting from the market tailwinds. We’ve got a real focus on rolling out new products, particularly in Workforce Solutions, but also in USIS. Our UGN products are another growth area for us. And I think what we’re pleased with is the fact that both USIS and Workforce Solutations are outgrowing the mortgage market. How do you view that? We view that with new products, new solutions, driving more usage of your products, in particular with gaps around the TWN income and employment data being were pulled more frequently. And then, the system-to-system integrations, where we still have a lot of runway to work with our customers to convert them from dialing in and keying into the system on an individual applicant basis to pull the income and employment data to go into system-to-system integrations, which, as you know, is more on the credit file side, but is one that’s an opportunity on the income and employment side that really we’ve seen big lifts in utilization, when we are indebted in the workflows and the income and employment data. We’ve got great progress in adding those in the third quarter in 2020.

Manav PatnaikBarclays Capital — Analyst

Got it. And then just on the tech transformation. When you started the program, you talked about $1.25 billion as the number. And it’s a pretty big number. We thought maybe you left some buffer room in there, but the last time, you said $1.4 billion and I think today you said, it is a $1.5 billion program. So, I was just curious, that incremental $250 million. Like, I guess, where did we go over budget, or where is that extra spend being required today?

Mark W. BegorChief Executive Officer

Yeah. And that’s been an area that we’ve been clear that we’re going to invest more and we see opportunity to do that to accelerate the transformation. And just to be clear, and I know you know this, but the $1.5 billion we now talk about is the incremental spend in 2018, ’19 and ’20. So, that’s going to be behind us and that’s how much we’re going to spend through the end of the year. We’ll obviously be spending money in our technology as we go into 2021 and beyond, and that’s going to be our run rate spend versus the incremental spend that we talk about. And with our strong financial performance in the second half of 2019, we started investing more in the tech transformation. And as we continued in 2020 and performed so strongly during the COVID recession, we made strategic decisions to accelerate our spend in order to drive it more rapidly. We think that’s the right thing to do, because of the sizable benefits that we expect to get from the transformation.

Operator

Our next question comes from Andrew Steinerman with J.P. Morgan.

Andrew SteinermanJ.P. Morgan Securities — Analyst

Good morning. Just two questions, quickly. First one, I didn’t catch if you gave the total Equifax third quarter revenues related to mortgage. So, I’d like that, if you could. And then, looking at Slide 13, under EWS non-mortgage September, stood out to me how it jumped forward and then sort of October kind of normalized back to July, August rate. Could you just talk a little bit about that September jump forward?

Mark W. BegorChief Executive Officer

So, in terms of total mortgage revenue, the total mortgage revenue was a little over a third of Equifax total revenues. So, that’s the best way we can estimate that. And in terms of September non-mortgage for EWS, we have a substantial business with government and other participants and so, it can just be a little choppy. And obviously, the underlying revenue base Isn’t that large. So, the movements between months can result in different growth rates between the months. But honestly, that’s why we indicate that when you’re looking at those numbers, you can consider them indicative. And that’s why we focus a lot more on the quarterly numbers.

Andrew SteinermanJ.P. Morgan Securities — Analyst

Thank you.

Operator

We’ll take our next question from Toni Kaplan with Morgan Stanley.

Toni KaplanMorgan Stanley — Analyst

Thanks so much for taking my question. I just wanted to ask broadly about how you’re thinking about the trends in consumer credit. On one hand, we’ve heard some lenders talking about borrowers — more borrowers exiting forbearance and defaulting, which could impact the appetite for lending. But on the other hand, you have recovery trends taking hold in the economy, with things opening up. So, wanted to hear broadly about that and specifically, also, just wanted to ask about the sort of better September non-mortgage number within USIS and then October getting a little bit more in-between, like where September and the other months of the third quarter were.

Mark W. BegorChief Executive Officer

Thanks. The first half of the question, Toni, is obviously complicated. It’s a economic event, a health event like we’ve never seen before. Broadly, the consumer is still fairly strong. Arguably, there is high unemployment, but some of the stimulus benefits have helped the consumers. When we talk to our customers, their delinquencies are not increasing yet, because they are making minimum payments and they’re not behind in credit card payments, etc. I’m talking broadly. So, I think that’s kind of what’s happening so far. I think what we’re all watching is what happens as stimulus dollars are out. Are they going to be stimulus dollars, either pre or post the election in a few weeks. It’s tough to see where is unemployment going to go. Yet, on top of that, what’s the timing of the vaccine and how quickly will it be deployed across the population, which obviously will drive economic activity, it’s just a lot of challenging sector [Indecipherable] try to work through. What’s underlying that, from our perspective, is the data is more valuable than ever for our customers. And that’s what we’re seeing. Obviously, our performance is quite strong. Data is being used to try to look through to who are the customers, the consumers that are still working; who are the consumers that can take a line increase or have a mortgage rebuy or what is the data. So, I think that’s a positive for our industry. But you point out, which is why we struggled providing guidance for the fourth quarter of 2021. At this stage, it’s still quite uncertain about where that consumer is going.

John W. GambleCorporate Vice President, Chief Financial Officer

In terms of your question on September, at minus three, and then the quarter, minus five, and our discussion around mid October at about minus five. Again, the about minus five and about minus three to us are very similar numbers, right? And this September’s monthly data. So, I think the important fact is we are seeing an approving trend. We expect that we’re seeing our business improve in non-mortgage and we’re very happy with that trend. But as we look through the rest of the fourth quarter, about 5%, it can be a little bit on either side of 5%.

Operator

Our next question comes from David Togut with Evercore ISI.

David TogutEvercore ISI — Analyst

Thank you. Good morning, and appreciate all the helpful disclosure in the deck. The number-one investor question I receive on Equifax is whether revenue in our growth is peaking, given this extraordinary mortgage market expansion, which clearly benefits both USIS and EWS, along with increased appetite for TW unemployment and income data during the pandemic. And clearly, there are a number of positives that will sustain the 20% growth in TWN records, the growth in NPI, the growth in the pipeline. But as you start to think about 2021 framework, do you want people to start with that 6% core growth from the third quarter? What are some of the parameters that you’re starting to think about, as you frame your own views on 2021?

Mark W. BegorChief Executive Officer

Again, I think we’re going to try to avoid getting into 2021 guidance, but we were quite intentional because we’re getting the same questions you’re getting about what — how do we look through Equifax’s very strong performance in the year, particularly from the incremental UC claims revenue which is meaningful that we’ve highlighted will likely normalize in 2021 with unemployment presumably coming down or unemployment claims not continuing. And then, of course, the U.S. mortgage market. The U.S. mortgage market, that’s one that it’s difficult for us to [Indecipherable]. John talked a little bit about that one. We can’t forecast what’s going to happen in 2021 on the mortgage market, but the fundamentals are still quite positive for 2021 in the U.S. mortgage market with the Fed stating pretty strongly that they’re going to keep interest rates at the record lows through 2021. So, that’s a positive for refinancings and for purchase volume. We’ve seen that purchase volume really accelerated in the last 90 days in the United States, as consumers are going out to buy homes or upgrade to get larger homes or moving to the suburbs. And again, we’re not forecasting, but it feels like there is some legs on that macro. And then, of course, the refinance side, there is still a very sizable population, as John pointed out, of consumers that have not been [Indecipherable] yet [Indecipherable] both of the quarters [Indecipherable]. With regard to 2021, you highlight some of the positives for Equifax. You can start with a lot of our businesses are still challenged by the COVID pandemic. We’re not forecasting 2021, but if you believe that there’s going to be a vaccine and the vaccine is going to result in more normal recovery of some sort, that’s going to be good news for Equifax in international or non-mortgage businesses in the United States, our GCS business. So, that’s a positive, as we go forward. You point out the power of Workforce Solutions. As we entered the pandemic, USIS was in a recovery mode, following the cyber event. We believe USIS is performing quite strongly on a mortgage and non-mortgage basis during the pandemic. But as we get into more of an economic recovery, we expect that to accelerate as exhibited by the deal pipelines that are growing and the increased commercial activity. And of course, Workforce Solutions, we’ve attempted to really highlight how important that business is, how important performance is. They’ve got a long list of structural levers, if they can — that they’ve been pulling and will continue to pull. And you pointed out records. The $6 million addition in the quarter is going to serve them well with higher hit rates, which drives higher revenue in the fourth quarter and into 2021. Then, of course, the other elements of the business. And so, our attempt in providing additional disclosures this quarter was to help you and our investors see through the underlying performance in the COVID recession. And again, we’re still in a COVID recession. With Equifax delivering 6% core growth, it’s really quite strong and the tailwinds — Add on top of that the benefits from the tech transformation, that, as we’ve talked about, and we’ll be very clear, will begin really kicking in 2021, which will be another positive for us on both our top-line margins and cash generation.

David TogutEvercore ISI — Analyst

Appreciate that. Just a quick follow-up on capital return. Will you be in a position to do more in terms of capital return as we approach 2021 in terms of dividend growth, buyback, more M&A?

Mark W. BegorChief Executive Officer

Yeah. We’ve been clear that — again, I don’t want to give guidance and we don’t — as you know, we don’t have a financial framework in place. But we’ve been pretty clear that it’s our goal to get back to that. We’ve been investing heavily in our tech transformation and we’re getting the big spend in our tech transformation certainly behind us in 2020 in our three-year plan. And it is — we believe that our cash generation will accelerate as we go through ’21, ’22, ’23, which is going to provide free cash flow for us to invest in M&A, which we talked about earlier in the call. It’s our intention to have more focus there, and we don’t want to give any guidance around our intent to do a buyback or reinstate dividend growth. But we had that framework in place before and we’ll certainly consider it in the right time, when we put our financial framework and capital allocation plan back in place in the future.

Operator

Next question comes from Kevin McVeigh with Credit Suisse.

Kevin McVeighCredit Suisse — Analyst

Great, thank you. Spend a minute on the progression of the clients in EWS. If I get my math, it looks like the average client size was about 4,000 back in 2008 and that number is closer to 110, based on just the simple math client versus records in the work number. Due to needs of the smaller clients increase, is there any way to frame what the opportunity is, as you kind of triangulate from a dollar perspective, kind of the Work Number with the core USIS, as you look at it a little bit. So, just trying to get a sense of, again, the market opportunity as you go more down market and then what that community enterprise overall.

Mark W. BegorChief Executive Officer

Yeah. First off, more records is more valuable, right? And more contributors is, too. And moving 6 million — up 6 million record this quarter, we think, is a big milestone where we were flat in the second quarter, but there is some bumpiness to when records come in and we had a very strong quarter of execution. There were up 20% of record year-over-year and as you know, that’s going to drive hit rates and revenue growth going forward. And then to your point, you just did not really the addition of more companies. There’s all kinds of numbers out there on how many companies there are in United States, whether it’s 3 million or 4 million or 5 million. But going from 69,000 a year ago to a million companies really does increase the breadth and depth of the database. So, that’s very, very positive for Equifax and for our customers.

As you know, one area where the database is used is, what I would call, near prime or subprime customers. And you see those customers in all kinds of companies, but adding more companies, going to million companies, just brings more value to the database and we’re really intently focused on continuing to grow the database. We also mentioned earlier in the comments that getting to this level of scale, having 80 million uniques or 110 million active as well as inactives really takes the database almost as a catalyst to being very, very valuable, just because the hit rates go up. And the other thing I commented on is that the team is expanding their focus. We’ve had a W2 focus on non-farm payroll for a long, long time. And in the last year, we started to expand and focus around the gig economy 1099. We’re actually investing now into our database 1099 income data. Pension data is another one that we’ve got our sights set on. But as we’re going to head toward non-farm payrolls, that’s going to take time. But we’ve expanded our focus to go well beyond that to get all levels of employment or other income that consumers are having, so we become really a one-stop shop for all that data.

Kevin McVeighCredit Suisse — Analyst

Got it. And then just to follow up on that real quick, I know obviously the focus has been on the mortgage side. But it seems like there is the opportunity to flex that out across other credit instruments as well. Is that correct?

Mark W. BegorChief Executive Officer

It is. That’s a big focus for us and we’ve talked in prior calls that the values that we’ve been there and we shared with you and others, that if you take our credit data and add income and employment data to it, the predictability or the KS4 from that decision builds up dramatically. So, that’s always been the back. It’s one that we’ve been sharing with our customers for years. The COVID crisis has created a catalyst for that. And we talked about in the last call, in the second quarter call, that we’re seeing, for example, credit card customers. We’ve got a couple of major credit card customers that are now embedding the Work Number data into their origination workflows. So, adding into the credit file. That’s a big deal for us to get into that space. And the auto space historically has been used in closing for subprime customers. And now, we’re seeing it used more broadly because it increases the predictability of that underwriting decision. And it was really around our focus on differentiated data, but importantly, the TWN income and employment data is just very, very unique and in the scale, which provides real value. And of course, we’ve talked about in this call the government is also a very fast-growing vertical for us. I talked about the new Social Security Administration contract that kicks in 2021. That’s an example of how we’re expanding the use cases of the TWN data. And then of course, another growth area for us around the data is in point of decisions. When you’re hiring someone, we call TWN Solutions. So, that’s another area that we see future growth. So, there’s just a lot of levers for growth in that business.

Operator

Our next question comes from Ashish Sabadra with Deutsche Bank.

Ashish SabadraDeutsche Bank Securities — Analyst

Thanks for taking my question and thanks for the clarification on the FMS. My question — follow-up question there was when does that difficult comp from a big client win last year anniversary and we start seeing FMS get back to a more normalized profile. Thanks.

Mark W. BegorChief Executive Officer

Sorry, I think that you’re breaking up a little bit. Could you repeat that question?

Ashish SabadraDeutsche Bank Securities — Analyst

Oh, sorry. Sorry about that. My question was on FMS. There was a difficult comp there. I was just wondering when does that difficult comp anniversary and when do we get back to a more normalized growth in the FMS business.

Mark W. BegorChief Executive Officer

Yeah. So, your question about the FMS. First off, we’re still in the COVID recession and as you know, that business provides data for both portfolio management and marketing. And as I pointed out in my conversation, John did, too, a lot of our customers have curtailed or slowed down new account originations, which impact the business. And so when you talk about normalized growth, the first thing or the biggest factor that’s going to drive that will be a resumption of originations, which we started to see, we covered a bit and we have a couple of customers in the quarter and in September that started to originate — started originations and actually had originations volumes — revenues [Indecipherable] were above last year. So, we’re starting to see signs of those originations. John pointed out, we also had some — a couple of larger deals, if you will, in 2019. I would attribute that to part of the USIS recovery that repeated in 2020. I would characterize most of that is driven by the COVID recession and the in fact, decisions our customers are making around some sort of originations. But we all know that our customers will start originating again, once their confidence grows. They have to. If you’re — that’s a part of your business, you have to continue to add new customers. So, it’s just a matter of when they start doing that and we would expect the business to grow there. On the portfolio management side, that’s where we’ve seen some increased activity, as customers are focused on managing the back book. We would expect that to continue to be a positive tailwind, as we move into the fourth quarter of 2021. It’s typical and as you’re coming out of the recession or in a recession, there is a lot of focus around managing your existing portfolio.

Ashish SabadraDeutsche Bank Securities — Analyst

That’s very helpful color. And maybe just a quick follow-up on the cost savings. Thanks for those details. I was wondering do you have a timeline by which we should start seeing those savings flow to the bottom line? And any incremental thoughts on how should we think about the investments, going forward? Thanks.

Mark W. BegorChief Executive Officer

Yeah. That’s one thing. We’re not ready to give 2021 guidance. We’re not giving guidance, it is our plan to provide some visibility in the future — in the near future around what we expect some of the benefits to be in 2021 as we have some level of framework for 2021. We’re not sure we’re going to be able to provide guidance, but we will definitely do that. We’re just not ready to do that today. That said, we have been quite clear around what we expect the benefits to be; the sizing of the cost benefits that we’re going to get from the cloud transformation; the cash benefit that we expect to generate, which we believe are sizable. We haven’t framed yet what we expect the revenue benefits to be. Those will all be firmly embedded in our long-term framework when we put it back in place.

Operator

Our next question comes from George Mihalos with Cowen.

George MihalosCowen & Company, LLC — Analyst

Great. Good morning, guys, and thanks for taking my questions. I guess, first, to kick things off, Mark, I think you said that about 20% of verification revenue is coming from inactive accounts. And I’m just curious, how long can an inactive account be monetizing? What’s sort of the lifespan of an inactive account? And then, does that really skew to one vertical within the EWS more than any other. So, for example, mortgage for your bundling services or something like that?

Mark W. BegorChief Executive Officer

That’s great questions. One, we haven’t talked a lot about 20%, the big percentage of our revenue. It really — it’s really every vertical has different use cases. We’re having a multi-multi-year period. Multi-year history of some of the employment is quite valuable. The other use case is someone working today and how much do they make. And then there’s other use cases where they’ve been working for the last 12 months or they’ve been working for the last two years. And as you know, people change jobs. So, having a multi-year multi-job working history for someone is quite valuable. We have something like an average of 4.5 jobs per unique individual in the database, which would make sense. There’s a lot of people that change more often; over a 5-year period, 6-year period. 2-year period and others have been some that are in the same job, but that history of data is incredibly valuable in some use cases where you have to have the history. So, not only having what someone is doing today is less valuable, which really pulled down the path of like if somebody is going to provide [Indecipherable], that might work in some situations. Most of our customers don’t take those anymore, but when you have use case, if someone wants to know where did you work for the last two years, the only way to really prove that and get it quickly and completely and accurately is to come to Workforce Solutions. So, that’s why it is used. And if you go around verticals, it’s really in every vertical. Mortgage has got a lot of use cases where it’s very, very important to have a real history of work and employment and income. Auto has it. Cards, less so, although there’s use cases where some card issuers are looking at that. In the government space, as you know, it’s valuable both today as well as history. And it just reflects the value of the business. It’s taken us a decade to build up that 450 billion records on individuals. It’s just very, very valuable.

George MihalosCowen & Company, LLC — Analyst

Okay. That’s super helpful color, really appreciate it. And then just as a quick follow-up, I think obviously within GCS partner, is there increased pressure. And yeah, I think if I caught the comment, you were suggesting that it will stay weak through the first half of next year. I’m just curious if you could talk a little bit about the visibility that you have in that channel of the business, going forward.

Mark W. BegorChief Executive Officer

Yeah, I didn’t say through the first half of last year. I think we said we expected it to stay soft through the fourth quarter. We don’t have visibility, just to be clear. But in our discussions with customers in that space, which is really in the lead generation space, it goes back to the origination point I had earlier around our USIS [Indecipherable] business, customers, originators, whether your bank card or personal loan, clearly curtailed in the COVID recession the origination. So, that impacts our [Indecipherable] business and also impacts some of our partners to use our data in the lead-gen space. So, that will come back over time. We don’t know when it is. It’s hard to forecast. As we look out for the fourth quarter, we expect it still to be weak in the fourth quarter on the lead-gen side, just because we don’t see signs. We see signs of improvement, but not to where it was a year ago.

George MihalosCowen & Company, LLC — Analyst

Okay, great. Thank you. I misheard that one.

Operator

Our next question comes from Hamzah Mazari with Jefferies.

Hamzah MazariJefferies — Analyst

Hey, good morning. Thank you. My first question is just on the tech transformation timeline. Any way to think about the risk that that timeline bleeds into sort of 2022 with COVID?

Mark W. BegorChief Executive Officer

Yeah, we’ve been pretty clear on all of our calls during the COVID recession that we’ve been meeting our milestones and we’ve had no change in our plans. And we talked a bunch on the call already this morning around ACRO, TWN etc. being in the cloud. So, we’re pleased with our milestones and we’re also very pleased with our migrations. Remember, there’s two pieces with tech transformation. One is getting the technology right and getting our data assets and applications into the cloud. And then second is migrating our customers to it. So, you saw that we’re making good progress in the third quarter and we expect to make good progress in the fourth quarter. So, we’re pleased with our progress. There’s still a lot of work to do, but we’re meeting our internal milestones that we’re trying to share with you transparently. And we confirmed that the focus was on North America, which is like 80% of the revenue. We have indicated that some smaller properties or smaller businesses would trail out further into the future, but that would just become normal spend.

Hamzah MazariJefferies — Analyst

Great, that’s very helpful. And just my follow-up on the mortgage market, specifically just on Fannie and Freddie. Any potential changes there under either administration; either more autonomy, new capital rules, privatization? Just any charter on Fannie and Freddie and how that may impact you, or is that not really a big deal? Thank you so much.

Mark W. BegorChief Executive Officer

Yeah. We are — There’s a lot in that question. You got into the what could happen in the elections and versus — Democratic versus Republic, and then you’ve got to get into all the senate, etc. I think that’s probably a longer question, but I would say broadly, specifically in Fannie and Freddie, we don’t see any changes. In fact, the Equifax administration changes are not depending on Freddie’s. Frankly, more broadly, we don’t see how [Indecipherable] operates. We provide a very valuable service to U.S. consumers and to or customers and we don’t expect that to change whatever happens in November.

Operator

We’ll take our next question from Bill Warmington with Wells Fargo.

William WarmingtonWells Fargo Securities — Analyst

Good morning, everyone. So, this new I-9 product you guys introduced last week that takes the I-9 management suite down market to the small and mid-sized businesses. I realize that’s part of the employer services, but — and not Verification Services. But is it strategy to use the I-9 product as a source of new leads for the Work Number?

Mark W. BegorChief Executive Officer

Yes, it is. We like our talent solutions and employer services business is a complement to our Verification Services business and help for us the idea of having more connections and services with the HR manager who will be providing us — making the decision to provide us their payroll records for the verification side of the business. we think is positive. So, there is no question, we want to continue to expand the services and products that we provide. On the I-9 side, we introduced a number of I-9 products that we’re really pleased with their performance and I-9 anywhere that allows a perspective employee to complete that process remotely using a digital solution. And then some of the smaller company products that we’ve introduced is just examples of our focus on innovation and new products, both to drive the business but expand our relationship because I would characterize it with the HR manager. So, we have more connections for the broader ecosystem of Workforce Solutions.

William WarmingtonWells Fargo Securities — Analyst

Got it. And as my follow-up question, I just wanted to ask on the Social Security Contract that’s starting up next year, the $40 million to $50 million in revenue, any additional color on the timing of the start of that revenue; beginning of the year, middle of the year, something?

Mark W. BegorChief Executive Officer

Yeah, too early on that one. We certainly expect revenue in 2020, which is why we talked about it that way. A full run rate is going to be to $40 million to $50 million. It likely won’t be full run rate for sure in 2021, but we’re actively working on the technology elements with our customer, is driving it. We talked about this contract because of the size of it. It’s unusual to have contract of that size, you’ll get landed. But it’s just a reflection of the value of the Workforce Solutions data in so many different verticals and use cases in this case [Indecipherable] government space with subsidiary administration.

Operator

Our next question comes from Andrew Jeffrey with Truist Securities.

Andrew JeffreyTruist Securities — Analyst

Hi, guys. Appreciate taking the question. It’s been a long call, full of good information. Mark, I just wonder if you could address Equifax’s position in fintech. I know it’s one of the areas in COVID that’s maybe going a little bit weaker than some of the structural growth areas that you enumerated, but maybe a cyclical outlook there and also market share plans and outlook would be helpful.

Mark W. BegorChief Executive Officer

Yeah, I think we’d been clear in the space that we refocused on starting building out resources in the latter part of 2018. We added resources in 2019. I think from commercial resources, we’re probably between 2x and 3x what we had two years ago. So, it’s a space we want to be bigger in. We think we’re well positioned to be bigger in it. We had pretty strong market position, with most of the fintechs with our TWN data where it’s used and, of course, is expanding usage during COVID. And we’re working to take advantage of that relationship to move some of our credit data. We had some positive wins. It’s, I don’t know, $250 million market in the United States. I think you know our competitors are much stronger than we are. But we think there’s room for Equifax to grow. Many of those are single source in the fintech, from starting out that way. They’re getting scale where they could be a dual source, which provides an opportunity for Equifax particularly when we’re already in the duel with our TWN data. They have been more impacted than how we characterized in FY, particularly because of their funding requirements. They typically aren’t balance sheet funded. So, they’ve been more impacted on originations. But we’ve stayed supporting them and we’re continuing to have some commercial wins during the last couple of quarters, events space and it’s an area that since thing in the USIS team are focused on right growth in the future and we see it as a strategic market for us, going forward.

Andrew JeffreyTruist Securities — Analyst

Thank you, appreciate it.

Operator

We’ll take our next quesI’ll wration from Andrew Nicholas with William Blair.

Andrew NicholasWilliam Blair & Company — Analyst

Hi, good morning. Can you speak to the potential for competitors to replicate certain aspects of the Work Number database in the U.S. over a longer timeframe? It certainly seems unlikely that had the same level of integration with employers and the same number of employers. Are there other ways to gather some of the same data aspects, whether it be through some of the payroll processors or annualizing demand deposit accounts? I guess, I’m just wondering how you protect your mold there and whether alternative approaches to gathering income and employment data could result in alternatives for your customers down the road.

Mark W. BegorChief Executive Officer

Yeah. we think we have real scale in the business, which provides a competitive advantage for us with Workforce Solutions. We’ve been on this business for over a decade. And we invested between the acquisition of business and when we invested in technology resources, a couple of billion dollars, over the last 10 years. The scale of the business we can provide some real strength to the competitive advantage. We talked about the history of the data, which is really hard to get on an individual, where [Indecipherable] over the last two years [Indecipherable] where did you work two years before that or the two years before that. Collecting that data is quite challenging. We’re participating in some of the other ways to collect data. You pointed out, bank transaction data and trying to tune in. The net pay in someone’s bank account. That’ a data source, but very difficult to get. The consumer has to consent to give the data. So, we think that’s quite challenging. So, we think there’s just a lot of strings around the business. We’re always looking at who our competitors are in every business and this is one where we think we have some real market strength given the scale of it. You point out the network of connections we have with so many customers. And then of course, we’re now having a billion companies deliver data to us on a period basis. That makes this data set very, very valuable and tough to replicate. And if you’re one company, then you’re likely not going to give the data to two companies. You’re going to give it to the company that’s been in it for long time. And we think that’s another important element for Equifax. Our strengths of the business are proprietary and our security around it, the fact that we authenticate anyone of use of the data before they’re able to use it. There’s just a lot of security and protection around it, which is very important to those that actually on the need and contributed to us.

Andrew NicholasWilliam Blair & Company — Analyst

Got it. Yes, that makes sense. Thank you. And then switching gears a little bit from my follow-up. So, maybe you could speak to the margin performance in the International business in the third quarter. Margin expanded quite nicely year-over-year despite the revenue decline. So, I was just wondering if there’s anything you can point to specifically on the cost front in that segment and then how permanent some of those savings could potentially be.

Mark W. BegorChief Executive Officer

We did some cost work in International in 2019 that we’re getting benefits from. And then there has been some tightening during 2020, during the COVID pandemic, that you pointed out were pretty strong performance on margins, given the revenue declines, which is still quite substantial in, I think, international because of the COVID pandemic. So, we would expect those as — the COVID pandemic get behind, as economic activity improves. And obviously, revenue should go with that and improve should be positive for the margins of that business, going forward.

Operator

We’ll take our next question from Jeff Miller with Baird.

Jeffrey MeulerRobert W. Baird & Co. — Analyst

Thank you. Good morning. So, John, I think you try to print this question with the bridge you gave us on the slides. But just on the Q4 illustrative framework, EPS being down slightly on low-double digit revenue growth, it looks like a lot of headwind factors you’re calling out in your bridge have kind of all year yet has had good EPS growth year-over-year the first three quarters. So, anything else to call out on Q4 EPS and framework?

John W. GambleCorporate Vice President, Chief Financial Officer

Yeah, the only thing you’re seeing is the other is a little bigger than it’s been in some of the other quarters, right? And it’s really driven by the fact that the comment I made around corporate expenses, you’re seeing a significant increase in incentive compensation because of the fact of the business performed so incredibly well over the past two quarters. So, our expected performances improved quite significantly, and you’re seeing that across different areas of incentives including sales carbon center and that’s affecting the fourth quarter because of the very, very strong performance. We continue to be spending related to the tech transformation and some of that is flowing through one-tech expense because of the biggest drivers. The other thing that you’ll see and it’s put on the chart, right, is tax rate is actually higher in the fourth quarter, right, year-on-year. So, that negatively impacts the comparison as well by $0.03 or $0.04 a share. So, those factors together are what drives the difference between the revenue growth and [Indecipherable].

Jeffrey MeulerRobert W. Baird & Co. — Analyst

Okay. And then, I’m struggling to understand the magnitude of the change in trends in the Q4 outlook for the GCS partner channel. Is this all about kind of activity after new gens and member count not being backfilled yet on the churn side, or were there any loss of partners or any changes of terms with sizable partners pricing or how the use you?

Mark W. BegorChief Executive Officer

Yeah, there’ a number of things in there, Jeff. There certainly is — We’re all working with our customers to help support them in tough economic events. So, I think we could attribute that to the changes in perhaps pricing and things like that, but then there’s also the underlying volume that’s quite challenging, which is also a contributor as their customers [Indecipherable] with our FMS business still are not anywhere near the pre-COVID levels with regards to originations.

Jeffrey MeulerRobert W. Baird & Co. — Analyst

Okay, thank you.

Operator

We’ll take our next question from George Tong with Goldman Sachs.

George TongGoldman Sachs & Co. — Analyst

Hi, thanks, good morning. Mark, you mentioned that core revenue growth was 6% in the quarter, excluding benefits from unemployment claims in the mortgage market. Can you talk a little bit about what may be driving the difference between the 6% core revenue growth and non-mortgage B2B revenue performance in the quarter that was roughly flat to down?

Mark W. BegorChief Executive Officer

I think, as I follow your question, it’s really going to be the outperformance of our mortgage businesses, which is Workforce Solutions. Its growth obviously in the mortgage market is up, as we highlighted on couple of slides in our comments. They’ve got core growth in the mortgage business. So, that’s going to drive that. And with USIS, the 600 basis points of growth in mortgage from core versus the mortgage markets, Workforce Solutions is multiples that from new records, new products and everything else. So, that’s really what’s driving it now, which we think is very positive in COVID recession. Of course, the rest of it, the non-mortgage businesses in Equifax are still negative in many markets and verticals because of the COVID recession. Those trade will recover as economic activity comes back in the future, as we get through past the COVID market impact.

John W. GambleCorporate Vice President, Chief Financial Officer

As Mark indicated, and you’re right, George, it’s our strategic focus to try to make sure we dramatically outgrow the mortgage market and what that’s showing is that we’re achieving that very successfully, even though the non-mortgage businesses are weaker because of COVID.

George TongGoldman Sachs & Co. — Analyst

Got it. And looking at monthly trends, specifically in the non-mortgage business, USIS revenue has been largely consistent at down roughly 5% year-over-year, moving through the quarter. And then non-mortgage EWS also consistently down about low single digits, if you exclude that, John, that we saw in September. And so, can you talk about some of the puts and takes around non-mortgage of revenue performance in 3Q that didn’t seem to improve moving through the quarter? The trend seemed relatively stable. So, just some puts and takes around that.

Mark W. BegorChief Executive Officer

I think it’s all — it’s really all those verticals are really still not recovering and we expect it will. I think our competitors are seeing similar challenges with whether it’s card originations or personal loan volume, as the financial situations are being quite conservative and they should be until they have some clarity around where the economy is going. When they do, they’re going to start to originate again and that will be positive for us as, we go forward in our non-mortgage businesses.

John W. GambleCorporate Vice President, Chief Financial Officer

But we did see improvement in September in USIS non-mortgage, relative to what we saw over the July August period, right? It certainly did get better and then we saw that improvement. We talked a bit about that in the script. And the same is true in EWS, where it did get better. I — When asked the question, I was simply trying to [Indecipherable] expect 16% to continue, right? But we did see an improving trend both in USIS non-mortgage and EWS non-mortgage during the period.

Operator

We will take our next question from Gary Bisbee with Bank of America Securities.

Gary BisbeeBank of America Merrill Lynch — Analyst

Hi, good morning. Thanks. So, I guess, it’s two-parter on innovation, if I could. You’ve obviously talked since the beginning of the tech transformation about the opportunity to accelerate innovation, I’d love to just get a sense of where you are with that, if you’ve made enough progress with that happening and if it’s more of a future opportunity. What’s the timeline? And I guess the second part of that, the [Indecipherable] Equifax talked a lot about the concept of vitality and even just to talk about annual classes of new products and sort of how the three-year company forecast for revenue on those was doing. If you could just help us think through that as well. Obviously, went down for [Indecipherable] growing again is meaningful in this acceleration of innovation fee of that vitality, going forward. Thank you.

Mark W. BegorChief Executive Officer

That’s a big priority of ours, as you know. And over the last couple of quarters, you’ve heard me talk about it because I really do it in the next chapter of Equifax that really accelerate our new product innovation to really lever the cloud investments that we’re making. And we believe that this is becoming a real catalyst for us to drive top-line growth. You’re seeing that — you asked about the timing. It’s really happening. In 2019, we did — It’s on the chart reportedly, in the earning slides. We did 19 new products, offering 60 in 2018. And that’s up from in the 70-80 range kind of pre-cyber events. So, in 2019, we are operating at higher level. And of course, we’ve gone from 90 last year to around 110 in 2020. So, there’s clearly a renewed focus on it. You saw a few months ago, we brought in a new Chief Product Officer. We’re adding new product talent and resources to really scale up our ability to bring new products to market. And remember, one of the reasons we’re making this cloud investment that we talked to so much about is because we’re going to put all our data assets into a single data fabric and we believe that’s going to accelerate our ability to do gated combinations and bring new solutions to the marketplace. So, that’s what this new product team is going to be focused on. It’s really leveraging the cloud investment that we’re making. So, what you’re going to see benefit some as you’re seeing it today [Indecipherable] this quarter and we talked about some of the new products we’re rolling out in the marketplace. So, that gives our commercial team more things to sell and more solutions to bring to our customers. So, going from 90 last year to 110, and my goal is to grow beyond 110 in 2021 as we continue to invest at resources and really leverage the cloud transformation. And with regards to the vitality index, I think that’s something that we’ve talked about before. I guess, pre the cyber event. I think it’s likely we’ll bring back the dialog with our investors. We already have plenty to talk about, but if there is interest in that, we’ll certainly bring that back. But new products are a key priority of ours. And as I characterize it in the next chapter at Equifax, it’s really going to drive our top-line growth.

John W. GambleCorporate Vice President, Chief Financial Officer

And we’ve mentioned this before, absolutely our products that are launched on the new infrastructure that are benefiting this already. And Mark talked about Luminate in his script and other front products. That’s certainly the case EID we talked about. So, kind of the broad suite is running on a new infrastructure. And then, we also talked about the fact that there are COVID response products that were built specifically on the new infrastructure and could be done otherwise. So, those are some examples. There’s certainly more and, yeah, we’re seeing benefits from it and we expect it to dramatically accelerate as we go into the first quarter.

Gary BisbeeBank of America Merrill Lynch — Analyst

Thank you.

Operator

Our next question comes from Brett Huff with Stephens.

Brett HuffStephens Inc. — Analyst

Hey, thanks. This is a long call. So, obviously, quick. You talked a little bit about the analytics as one strategy and then unique data as another strategy. And I think we talked a lot about the unique data today, which is in U.S. Can you give us an update on sort of the next major phase of the analytics development you guys are thinking about, as we think about the economic recovery and how to position Equifax for that next phase of growth?

Mark W. BegorChief Executive Officer

Yeah. There’s a number of levers there, Brett, that we talked about over the past couple of quarters. It starts with our Ignite and Analytics Sandbox. I think you know we’ve invested heavily in that and we’re rolling that out in the marketplace. That’s a tool for our customers to access our data as well as their own and to really drive analytics and solutions that will result in use more of our data. So, that’s very, very positive for us. And of course, we have a large D&A team that is focused on creating new solutions and we talked about some of those that are really are from our analytics about combining data assets that increase the predictability and some of our COVID response products to help our customers look at moving trended data to understand how our customer performed in the past to use that to create predictability about how they’re going to perform in the future. Adding income and employment data. Those are all part of our analytics to deliver a solution and those result in more usage of our data or specific revenue opportunities and new scores or other ways that we deliver those analytics to drive the predictability of the decision for our customers. And we believe the cloud investments are really going to just more opportunities to bring new solutions in from our D&A team to the marketplace.

Brett HuffStephens Inc. — Analyst

Thank you.

Operator

Our next question comes from Shlomo Rosenbaum with Stifel.

Shlomo RosenbaumStifel, Nicolaus & Co. — Analyst

Hi, guys. Thank you for squeezing me in over here. Mark, can you talk a little bit about the competitive environment? How you guys are doing outside of the mortgage markets in terms of like win rates and win pipeline, I know John made a comment about the pipeline being strong. Is this kind of white space, or you are able to go into unique data, like The Work Number and into credit cards or street out head-to-head competition? Are you guys kind of winning more? It’s — Outside of mortgage, if you can just kind of comment on that and if anything quantitative, you can share.

Mark W. BegorChief Executive Officer

Yeah. John shared some comments around our deal pipeline in USIS, which is your focus in ours. The USIS pipeline is quite rich. As you might imagine, it is in International GCS, but there’s a lot of focus by our investors and on Equifax, which is why we talk about the USIS deal pipeline, in particular. That;s up dramatically over where it was last year and the year before. We’re seeing increasing win rates and I’ve used the term that USIS is competitive marketplace. Now, in the COVID recession, that’s harder to see because you’ve got the pressures of the economic impacts from our customers on Equifax and on USIS. But we see the deal wins coming into the COVID recession. You saw the kind of strength of USIS revenue non-mortgage numbers, using that in particular in the second half of 2019 and coming into the first quarter of 2020. And we see competitively during the COVID recession impacts of the second quarter and the third quarter, USIS is performing quite well. So, we’ve still got a lot of confidence in that business and its recovery.

Shlomo RosenbaumStifel, Nicolaus & Co. — Analyst

Okay, thank you.

Operator

And that concludes today’s question-and-answer session. I would like to now turn the conference back to Mr. Hare for any additional or closing remarks.

Dorian HareSenior Vice President, Investor Relations

I just want to thank everybody for joining the call and for their interest in Equifax. I just also want to let everybody know that we will be around today and the days [Indecipherable] to answer any follow-up questions that you may have. So once again, thanks for joining and this does conclude the call. [Operator Closing Remarks]

Duration: 117 minutes

Call participants:

Dorian HareSenior Vice President, Investor Relations

Mark W. BegorChief Executive Officer

John W. GambleCorporate Vice President, Chief Financial Officer

Kyle PetersonNeedham — Analyst

Manav PatnaikBarclays Capital — Analyst

Andrew SteinermanJ.P. Morgan Securities — Analyst

Toni KaplanMorgan Stanley — Analyst

David TogutEvercore ISI — Analyst

Kevin McVeighCredit Suisse — Analyst

Ashish SabadraDeutsche Bank Securities — Analyst

George MihalosCowen & Company, LLC — Analyst

Hamzah MazariJefferies — Analyst

William WarmingtonWells Fargo Securities — Analyst

Andrew JeffreyTruist Securities — Analyst

Andrew NicholasWilliam Blair & Company — Analyst

Jeffrey MeulerRobert W. Baird & Co. — Analyst

George TongGoldman Sachs & Co. — Analyst

Gary BisbeeBank of America Merrill Lynch — Analyst

Brett HuffStephens Inc. — Analyst

Shlomo RosenbaumStifel, Nicolaus & Co. — Analyst

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