Australia has a new Comprehensive Credit Reporting System (CCR) as at 1st March 2014.
ADVANTAGES:
Higher Credit Rating for those who pay their Loan Repayments + Credit Card Payments + Mobile Telephone + Household Bills ON TIME EVERYTIME.
DISADVANTAGES:
Late payments can be reported on your Credit Record after ONLY 5 DAYS.
Under this new Comprehensive Credit Reporting System (CCR), organisations (e.g. Banks) will be able to access and report both “Positive” and “Negative” information relating to their customers. This information can relate to a customer’s savings history, credit card repayment history, loan repayment history, electricity bill payment history, telephone bill payment history, etc.
Under the previous Credit Reporting System organisations were restricted to accessing and reporting new applications for credit facilities and “Negative” repayment history (i.e. Positive history not reported).
Commentators within the Finance Industry suggest that organisations (e.g. Banks) will commence reporting “Positive Information” following the 1st March 2014 (CCR start date) and are unlikely to research and report “Backdated Information” (i.e. prior to 1/3/2014) as the costs to do so would be significant.
The new CCR system is similar to credit reporting systems utilised in other countries in which a customer’s “Credit Score / Rating” is assessed on both their positive and negative reported history and will be utilised by Banks within their assessment process for new finance applications.
Higher Scores = Lower Risk of Default = Lower Interest Rates
Lower Scores = Higher Risk of Default = Higher Interest Rates
