Veda Advantage has hit back at criticism of the incoming “positive” credit reporting regimen, arguing that many of the charges laid against it by brokers are inaccurate and that it will succeed in protecting consumers.

Speaking with Australian BrokerNews, Veda Advantage head of external relations Chris Gration said there is nothing “draconian or big brother” about the law, in response to claims it would deny credit to worthy borrowers.  “It will be the most highly regulated personal information in the country, with tougher consumer protections.” “Comprehensive credit reporting very significantly improves the capacity of the lender to work out if a consumer can afford the loan,” Gration said. “National Parliament has passed laws that basically say we don’t want consumers who are overcommitted financially being likely to be able to get loans. In doing so, there is an understanding that when a bank or credit union says no to an overcommitted consumer, that consumer will be disappointed, but it is still nonetheless the right decision,” he said.

Under the proposed new credit reporting regimen, a wider range of information will be available to lenders, including past account open and close dates, the type of credit issued, borrower credit limits, and payment performance history.  Source:  Australian BrokerNews

BIIA Comment:  The use of “positive and negative data” is recommended by institutions such as Central Banks, the World Bank and the IFC (Word Group).  The World Bank has issued recently a consultative report  on the General Principles For Credit Reporting.  To access the report click on this link