CCR2 Compliance
Seven compliance myths
Consumer understanding and misunderstandings of the industry are revealed
Alastair Douglas Chief executive, TotallyMoney
In our annual Financial Awareness Survey 2019, we asked a nationally representative sample of 2,000 UK adults a series of questions to test their personal finance knowledge. Myths on blacklists, unpaid student loans,
and some addresses being more favourable than others, adds to the confusion. And can even be damaging. Believing that the fictions might influence
someone’s decision whether to press ahead and get the support of a credit card or loan, or not. And sometimes the financial support of credit products helps with life-changing decisions. It is terrible to think some people put off
certain financial decisions because they believe they are blacklisted. Or that someone looking to improve their credit score does not know about the benefits of getting on the electoral register.
There is a credit blacklist lWhy people believe it – being ‘blacklisted’ is a commonly used term in the credit
industry. It refers to those who make multiple unsuccessful applications, which damages their credit rating and causes more rejections. People have come to believe this is an actual list they are added to if they have poor credit history. l The findings – our survey found that the majority of people thought the credit blacklist was a document that existed. Only a handful
of respondents (14%) were aware this is not the case.
Believing that the fictions might influence someone’s decision whether to press ahead and get the support of a credit card or loan, or not. And sometimes the financial support of credit products helps with life-changing decisions
CRAs decide who gets credit lWhy people believe it – CRAs hold all the information needed to determine someone’s credit score and create their credit report. This can lead people to believe that because the CRA holds the information, they tell the lender whether to accept or reject a credit application. l The findings – nearly one in three respondents (31%) believe it is CRAs that decide whether someone’s application for credit is accepted or declined.
Where you live impacts credit rating lWhy people believe it – when applying for credit you need to give your address. The mistaken belief is that you are asked for your address because where you live counts towards your credit score. l The findings – more than a quarter of those surveyed (26%) understood that your address and the area you live in do not impact your credit rating.
Two scores become one when you are a couple lWhy people believe it – many couples choose to apply for a joint mortgage, make big purchases together and open joint bank accounts. It is easy to assume, as a couple, you have one credit score for both of you. l The findings –more than one in two (52%) were unaware that your partner’s poor credit history could affect your individual borrowing ability, although when you are a couple, your partner’s credit score is not linked to your own. Around one in five (18%) thought that your marital status directly impacted your credit score, whilst a
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www.CCRMagazine.com June 2019
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