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What is Comprehensive Credit Reporting (CCR)?

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What is Comprehensive Credit Reporting (CCR)?

Comprehensive Credit Reporting is a government policy change that requires banks to provide additional data to the Credit Reporting Bodies – Experian, Illion and Equifax (previously known as Veda).

From mid-September, the major banks will commence Comprehensive Credit Reporting (CCR). As a result, customers with consumer credit cards, home, personal or car loans will start having CCR account information sent to the credit reporting bodies.

CCR will provide the opportunity for a more complete view of a customer’s financial situation during the credit application process. This will result in lenders being able to offer better lending decision outcomes for their customers.

What is a credit report?

For information on what a credit report is, please watch the YouTube video here.

How can customers maintain a healthy credit report?

Please refer to the Maintain a healthy credit report fact sheet.

What is a credit score?

Credit score

 

How can customers find out about their credit scores?

Please refer to the Find out about your credit score fact sheet and the Credit Report Summary fact sheet for further information

Credit reporting changes means personal lending just got smarter

If you are applying for a credit card, a loan, or to buy goods or services on credit, your credit report can make or break your application.

Change is coming

The credit reporting changes will provide a fuller, clearer picture of your credit history. These changes may make it easier – or for some people, harder – to get credit or a loan.Comprehensive credit reporting legislation requires the four major banks (ANZ, CBA, NAB and Westpac) to share at least 50% of their customers’ data with the credit reporting bodies who compile credit reports, with the remaining 50% within another twelve months.

Previously, your credit report mainly showed your ‘bad’ credit behaviour such as defaults and other credit infringements, personal insolvency information, like bankruptcies and debt agreements. Shortly, your credit report will also include new information, including a record of the types and credit limits of the accounts that you have open and your repayment history – which is a 24-month view on whether payments have been made on time for credit cards, home loans, car loans and personal loan accounts. The repayment history isn’t recorded for other types of credit like phone, gas or electricity bills. While the law will set down the timeline for the major banks to start sharing this information, it may take some time for all other lenders to start to share.

This is good news…

If you have been paying your credit card and loans on time, this will count towards your credit health – as you have been demonstrating your ability to responsibly manage debts. Credit providers can check if the credit you applied for is right for you. Better still, they may offer a loan with an  interest rate and repayment schedule that is tailored to your unique circumstances.

But there could be a downside for some

With a clearer picture of your financial health, credit providers are in a  better position to see if you should be given credit. A poor credit history will be more obvious, and you may not be approved for credit. But this can also have an upside for people who have struggled in the past and have a
default on their credit report. Under the new system, if you pay off the default and also keep up your payments on your other credit cards and loans, lenders will be able to see that you are now managing your credit and may be more willing to lend to you – even though the paid default will continue to stay on your credit report for five years.

Next steps

Get a copy of your credit report to check your credit health and ensure there are no errors. Credit reporting bodies will give you a free copy once a year.
To get your free credit reports, go to CreditSmart.org.au for information on the credit reporting bodies.

How can I improve my credit score?

improve credit score

 

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