Treasurer sets new December deadline
Consumers and lenders alike are set to benefit from the game changing report recommending Comprehensive Credit Reporting (CCR) be made mandatory by 2018. In May 2017, the Productivity Commission's Data Availability and Use report was released, which set out a timeline for industry sign-up to CCR.
Whilst many in the industry have expected mandatory reporting to become the reality, the transition has continued to be slow. In part this has been due to the ambiguity surrounding the government’s deadlines for the transition. However, in a statement made in May 2017, Treasurer Scott Morison has made it clear that the deadline is now 40% CCR participation by December 2017. Currently, only 27% of open financial services accounts have CCR data loaded, so time will tell whether credit providers can move fast enough to avoid the government’s now definitive deadline.
How this affects credit providers
It is anticipated that the recommendations in the report and looming December deadline will motivate Credit Providers to begin readying themselves for a CCR transition. Those who don’t begin their transition sooner rather than later risk the effects of adverse selection as the rest of the industry starts to share data and reconfigure their risk strategies accordingly.
However, those that have already supplied CCR data will now have access to a more comprehensive view of an individual’s creditworthiness due to more accurate scores as a result of more data; therefore allowing them to make better credit decisions and open up new customer groups that fall within their risk parameters.
Where to from here?
Supplying CCR data starts with an internal discussion around objectives and strategies.
For help to unlock the power of CCR, check out the Equifax CCR Resource Centre for articles that can help you plan your next steps.
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