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2 November 2017
The Australian Bankers’ Association has welcomed the prospect of increased competition and a better deal for consumers, but believes the comprehensive credit reporting regime announced by the Treasurer raises some important questions.
The new model means an in-depth, and comprehensive view of each and every person’s credit history and financial engagements will be used to assess their credit rating and the information will be shared and made available to all financial institutions.
Unlike the current system, in which only loan applications and loan defaults are recorded and used to assess an individual’s credit rating, the Government’s new mandate will require banks to provide a customer’s full repayment history. This means that, for the first time, customer credit ratings can be judged on the basis of missed or delayed payments.
Only customers of the four largest banks will be subject to the changes in the first instance.
“It is imperative that the safety and privacy of consumer data is paramount in the new scheme and that people are not unreasonably or unfairly denied credit,” said Anna Bligh Chief Executive of the Australian Bankers’ Association.
“Given the importance of these issues to bank customers, a number of questions about the Government’s proposal need answers,” Ms Bligh said.
“While the benefits to those who have a good report are outlined in the new model, the impact for those who miss or delay a payment, either intentionally or unintentionally, is not clear at this stage,” Ms Bligh said.
Contact: Kelly Stevens 0497 577 133