Three in five Australians are oblivious to credit reporting changes

In response to legislation proposed by former Treasurer Scott Morrison, credit bureaus will be supplied with at least 50% of the four major banks’ rich customer credit data by September 2018, rising to 100% by September 2019. Simultaneously, non-big four lenders have also begun voluntarily sharing varying types and volumes of data with Australia’s three CRBs.

All this new data, known as comprehensive credit reporting (CCR) data, means lenders will be able to see for the first time what type of credit accounts people have, their credit limit and whether they have been paying their loans back on time.

During this transition period, as more lenders start sharing positive data, we can expect to see credit scores fluctuate – most pronounced among consumers with multiple accounts across multiple lenders, with big four customers likely to see a change sooner, according to Poli Konstantinidis, Experian Australia/NZ Executive General Manager, Credit Services and Decision Analytics.

While fluctuating credit scores should not be a cause for concern, it is important to frequently check your credit scores to better understand your financial situation, Mr Konstantinidis explains.

“Confusion and lack of awareness about credit score changes mean borrowers with a strong credit history could be missing out on their chance to access lower rates of interest,” Konstantinidis said.

“Most concerningly, our research shows the people most likely to see the impact of changes to their credit score sooner rather than later are also the ones most in the dark.”