A Competition Watchdog has announced earlier this month that banks should share customer’s data in order help them find the best deal.
This has caused concern for privacy campaigners as our financial data is already widely shared, stored, and available anyway through various public and private bodies.
Most consumers think credit reference agencies only collect and collate data about our repayments and loans – but companies are instead cashing in on our data and selling it on, which can include all our transactions; every last one! Even something as small as paying a friend back for a meal!
Credit companies like Equifax, CallCredit, and Experian all do the same. These companies harvest vast amounts of information and sell it back to lenders, all nicely analysed and processed, in order for them to use.
CallCredit claims to be ahead of its competitors by actually monitoring what goes into our accounts – our income. CallCredit gets this information straight from our banks.
Eamonn Tierney, the managing director of credit solutions, makes the arguments that this data is needed in order to make borrowing “affordable”.
The data that would show up could be all forms of income. This could include wages, pensions, and any other form of regular payments. It could take into account all forms of income, down to every last penny.
Equifax claims that, through an algorithm and having access to all your income information, it can allow them to see if you have a sufficient and stable income.
Whom does data become available to?
Once this data is collected, it becomes available to clients when applying for credit from banks and lenders. This does give lenders full access to see if repayments can be made and whether or not credit should be given.
However, it may be a nasty shock for people to discover their data has been collected each month and stored over years. Whilst it may come as a nasty surprise, banks actually make it very clear in telling customers that their information will be passed on to credit agencies each month.
Many data stores, both public and private, have suffered data breaches, leaks, and hacks – Experian suffered one last year, for example. They have a wealth of information about our buying and income habits which does raise the questions as to whether we actually benefit from our data being stored, or whether we are actually just at risk from leaks, breaches, and hacks
IMPORTANT: advice on this page is intended to be up-to-date for the 'first published date'.
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