Potential Dangers with Credit Scoring System

‘Credit Scoring System Fraught With Potential Danger And Inaccuracies’ Says Founder Of New Zealand’s Only Positive Data Reporting Bureau

As reported in today’s media, a large credit agency is launching a rating system in New Zealand to facilitate in the assessment of the credit worthiness of consumers.

However, by only using the negative data currently available in New Zealand, (for example, previous enquiries for credit, bad debts and bankruptcy) provides a narrow and potentially dangerous view of an individual or business’s credit worthiness, says Ronnie Tan, founder and managing director of one of New Zealand’s leading credit management companies, CreditWorks.

“A scoring system, such as that suggested, is fraught with danger for individuals and businesses which may find themselves unfairly penalised and blacklisted due to the inaccurate picture portrayed by the current negative data reporting system.

“As we stated in February this year, New Zealand needs to move to a positive data reporting regime as quickly as possible. However, there are a number of fundamentals which we believe are crucial to the successful introduction of a consumer positive data credit reporting regime in New Zealand. These include developing a model specifically suited to the New Zealand market, ensuring that all providers of credit input data information in the system, to ensure it is meaningful AND creating an appropriate and well considered Code of Conduct and set of protocols around the collection and use of information”.

CreditWorks is the country’s only positive data reporting bureau. Set up five years to provide an in-depth credit reporting service for the building & construction industry, CreditWorks is now branching out into other sectors, with rapidly growing demand for its services. A number of leading businesses use the CreditWorks system, including PlaceMakers.

Founder and Managing Director of CreditWorks, Ronnie Tan is an expert in positive data collection and reporting, and is available for further comment or editorial opinion.

ENDS

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