Credit Reference Agency & Credit Bureau

A credit reference agency (UK) or a credit bureau (US) are one and the same, with the exception that credit bureaus is a term used in the US whereas the former is used in the UK. They serve the same purpose.

A credit reference agency UK or a credit bureau US, refers to a company that provide credit information or credit reports to credit card companies and other lenders, on prospective and existing borrowers or just about anyone else who borrows money from a financial establishment.

The credit information that is collected and kept by a credit bureau or a credit reference agency is sent to lending institutions such as credit card companies, banks, store card issuers etc., that request it.

This enables the credit company to assess from an individual's personal credit card history or credit report, whether s/he is is a credit-worthy borrower - (a good risk)!

Credit Reference Agency (Uk)

There are three credit reference agencies in the UK. These are Equifax, CallCredit and Experian credit referency agency. When you make a credit card application, or apply for credit of any other kind, the credit card company will do a credit check by obtaining data on your personal credit/card history from at least one of these credit reference agencies.

Credit Bureaus (US)

A credit information bureau works in much the same way in the US as a credit reference agency UK does. Credit bureaus collect personal financial data on individuals, from financial institutions with which they have a working relationship.

Credit bureaus in the US include Equifax, Experian, TransUnion, Innovis. For Canada, these are Equifax, TransUnion and Northern Credit Bureaus/Experian, to whom banks Creditors and other financial institutions send their credit information files on a regular basis.

As in the case of credit reference agencies, credit bureaus report files will include data on consumers', their credit histories, credit card accounts, payment, account balances, mortgages, loans, along with other relevant information - such as any action that has been taken against borrowers.

Credit Information

The credit information on consumers will have been collected from a variety of different sources by the credit agencies. This will include information taken from customers' credit card applications, court judgments, foreclosures, bankruptcies and from any other form of public records.

In a nutshell, credit card companies, banks, store credit card issuers and other lenders will also provide a credit bureau or a credit reference agency with credit information on you - their customer, in return for free access to the credit reference agency's credit rating and credit score files on you.

Credit card companies and other lenders use the data they obtain, to carry out credit assessments on potential and existing borrowers for credit card rating/credit scoring purposes.

Such assessments will typically consider borrowers' ability to repay credit card credit. It will also influence the credit card company's decision on what rate of interest will apply to individual borrowers. Generally speaking, the lesser the risk a borrower pose to the credit card company, the lower the rate of interest that will be applied. Importantly, such a decision will be governed by your credit rating or credit score.

The content on this site is purely for information purposes only and is not intended to replace your seeking professional financial advice.

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