Why Can Information Differ Between Credit Reporting Agencies

Why Can Information Differ Between Credit Reporting Agencies

This is a question we are often asked. I can understand that from a consumer’s perspective it must seem confusing that information can differ between credit reporting agencies. After all, aren’t credit reporting agencies meant to only record accurate information?

This is a question we are often asked. I can understand that from a consumer’s perspective it must seem confusing that information can differ between credit reporting agencies. After all, aren’t credit reporting agencies meant to only record accurate information?

To answer this question let me first touch on Australia’s credit reporting agencies. The largest of these is called Veda Advantage and most credit providers utilise the services of this company when assessing the risk profile of an applicant. The second credit reporting agency is known as Dun & Bradstreet. Although Dun & Bradstreet is a very large international company, their credit reporting activities are still small when compared to Veda Advantage. Having said this, they are increasing market share and I imagine they will rival Veda Advantage in the future. It is fair to say that these two companies dominate the credit reporting industry in Australia and the vast majority of credit providers consult with one if not both of these companies.

 

Credit Reporting Agencies are Independent

It is important to note that these two companies are completely independent of each other and they do not share information. In fact our privacy laws would prohibit the transfer of information between these companies.

In order for a credit provider to access a person’s credit file they must first be an active subscriber of a credit reporting agency. Not all credit providers subscribe to both credit reporting agencies. The majority of credit providers subscribe to Veda Advantage, while many major lenders such as banks subscribe to both Veda Advantage and Dun & Bradstreet.

Although fewer in numbers, some credit providers use Dun & Bradstreet exclusively.

Let’s suppose that a credit provider subscribed to Veda Advantage and not Dun & Bradstreet. When they entered information into a person’s credit file they would be recording this in their Veda Advantage credit report only. Using this example, if another credit provider was to view this person’s Veda Advantage and Dun & Bradstreet credit files they would see different information and this can course confusion for all concerned.

The same situation can happen in reverse should the credit provider only subscribe to Dun & Bradstreet.

 

The Accuracy of Credit Files

It is important to keep in mind that the information contained in a credit file is only as accurate as the credit provider that records it. Credit listings are recorded by the credit provider directly and the credit reporting agencies have little ability to verify the accuracy of this data. As you can imagine this situation can lead to many inconsistencies and errors with credit listings. There is no doubt that there are many people suffering due to faulty or inaccurate credit listings. This is particularly evident with payment defaults.

At Clean Credit we see many examples of inconsistent information in credit reports and are well aware of the problems people face as a result. The good news is many of these situations can be rectified by having  questionable credit listings removed from people’s credit files through credit repair.

 

John Dickinson

Clean Credit

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