4 ms·

Makes me think. Can I ask my bank to stop sharing my data with Equifax. Would they honour the request? Anyone working for a bank, what do you think?

deleted 9y ago
[deleted]
jon-wood 9y ago
At least in the UK it's a legal requirement for banks to share details with credit rating agencies, so no, they couldn't if they wanted to.
- Silhouette 9y ago
  Can you give any more information about that, please? Certainly when you apply to use financial services in the UK the terms often include consent to share your data with credit reference agencies, but this is the first time I've ever seen a suggestion that banks were required by law to do so. If that's the case then, given the demonstrable incompetence of Equifax, that law should be changed immediately!
- rahimnathwani 9y ago
  I don't believe that's true. (If it were, I could set up a credit rating agency, have all the banks share details with it, and then have free credit reports for my own (hypothetical) consumer lending business, rather than paying a pound or two for each pull.) Care to cite the specific law? I'd be very interested in knowing, if such a law exists.
  - mattmanser 9y ago
    Oh, you think it's a fair playing field? If you're not old chums with the right person in government, you won't be classified as a credit rating agency.
    - noxToken 9y ago
      I assume that there has to be a legal definition that outlines what will qualify a business as a credit rating agency. The requirements are probably cumbersome, but something must be written down somewhere to objectively define the requirements.
      - philipov 9y ago
        What counts as objective is determined subjectively by people with vested interests.
        noxToken 9y ago
        As soon as I clicked reply, that thought immediately jumped into my head.
      - chopin 9y ago
        I don't know much about UK law and this one in particular, but in theory the eligible companies could be listed in the respective law.
  - rahimnathwani 9y ago
    Too late to edit, but small correction: the comment to which I replied talked about 'credit rating agency' (the companies that rate corporate bonds) when I believe they meant 'credit reference agency' (the companies that sell credit histories). I repeated the error. In my comment, I meant 'credit reference agency', not 'credit rating agency'.
- rahimnathwani 9y ago
  Credit rating agencies provide ratings for securities (e.g. corporate bonds). Their clients choose to pay them to issue ratings, so that the buyers of the securities will be more likely to buy them. Credit reference agencies (Experian, Equifax, Callcredit) collect information about individuals and provide that information (credit history) to lenders for a fee. There's no statutory obligation for banks to provide information to CRAs[0]. But agreements between CRAs and their clients (banks and lenders) generally requires that, if bank A uses CRA B to get info on prospective customers, then bank A must also report details of all its customers to CRA B. There's some truth to what you said, though. It's often a problem for SMEs (small/medium businesses) to get loans. And, since only the bank they use for day-to-day banking has a good idea of their creditworthiness, they can't easily shop around to other banks. So there's legislation which forces the largest banks to make that information available to 3 CRAs, which must provide them to any lender which asks. BUT this only applies to SMEs (not consumers) and any SME can opt not to have their information shared in this way.[1] [0] https://ico.org.uk/for-the-public/credit/ https://ico.org.uk/for-the-public/credit/ "As there is no DPA requirement for lenders to report such data to the credit reference agencies, it is up to the lender to decide which credit reference agency they wish to use, if any." [1] https://www.gov.uk/government/publications/designation-of-banks-and-credit-reference-agencies-for-credit-information-regulations https://www.gov.uk/government/publications/designation-of-ba...

deleted 9y ago

[deleted]

jon-wood 9y ago

At least in the UK it's a legal requirement for banks to share details with credit rating agencies, so no, they couldn't if they wanted to.

Silhouette 9y ago
Can you give any more information about that, please? Certainly when you apply to use financial services in the UK the terms often include consent to share your data with credit reference agencies, but this is the first time I've ever seen a suggestion that banks were required by law to do so. If that's the case then, given the demonstrable incompetence of Equifax, that law should be changed immediately!
rahimnathwani 9y ago
I don't believe that's true. (If it were, I could set up a credit rating agency, have all the banks share details with it, and then have free credit reports for my own (hypothetical) consumer lending business, rather than paying a pound or two for each pull.) Care to cite the specific law? I'd be very interested in knowing, if such a law exists.
- mattmanser 9y ago
  Oh, you think it's a fair playing field? If you're not old chums with the right person in government, you won't be classified as a credit rating agency.
  - noxToken 9y ago
    I assume that there has to be a legal definition that outlines what will qualify a business as a credit rating agency. The requirements are probably cumbersome, but something must be written down somewhere to objectively define the requirements.
    - philipov 9y ago
      What counts as objective is determined subjectively by people with vested interests.
      - noxToken 9y ago
        As soon as I clicked reply, that thought immediately jumped into my head.
    - chopin 9y ago
      I don't know much about UK law and this one in particular, but in theory the eligible companies could be listed in the respective law.
- rahimnathwani 9y ago
  Too late to edit, but small correction: the comment to which I replied talked about 'credit rating agency' (the companies that rate corporate bonds) when I believe they meant 'credit reference agency' (the companies that sell credit histories). I repeated the error. In my comment, I meant 'credit reference agency', not 'credit rating agency'.
rahimnathwani 9y ago
Credit rating agencies provide ratings for securities (e.g. corporate bonds). Their clients choose to pay them to issue ratings, so that the buyers of the securities will be more likely to buy them. Credit reference agencies (Experian, Equifax, Callcredit) collect information about individuals and provide that information (credit history) to lenders for a fee. There's no statutory obligation for banks to provide information to CRAs[0]. But agreements between CRAs and their clients (banks and lenders) generally requires that, if bank A uses CRA B to get info on prospective customers, then bank A must also report details of all its customers to CRA B. There's some truth to what you said, though. It's often a problem for SMEs (small/medium businesses) to get loans. And, since only the bank they use for day-to-day banking has a good idea of their creditworthiness, they can't easily shop around to other banks. So there's legislation which forces the largest banks to make that information available to 3 CRAs, which must provide them to any lender which asks. BUT this only applies to SMEs (not consumers) and any SME can opt not to have their information shared in this way.[1] [0] https://ico.org.uk/for-the-public/credit/ https://ico.org.uk/for-the-public/credit/ "As there is no DPA requirement for lenders to report such data to the credit reference agencies, it is up to the lender to decide which credit reference agency they wish to use, if any." [1] https://www.gov.uk/government/publications/designation-of-banks-and-credit-reference-agencies-for-credit-information-regulations https://www.gov.uk/government/publications/designation-of-ba...