New laws passed by the Federal Parliament on 1 April 2012 mean that consumer credit reports are able to start recording additional pieces of information. Before then, consumer credit reports in New Zealand were only allowed to include identity details, credit enquiries and negative data such as defaults, court judgments and bankruptcies.
However, since the amendments to the Credit Reporting Privacy Code, your credit report contains additional information that can be viewed by credit providers when you apply for credit. The new data elements include:
- Type of credit and account (e.g. credit card and revolving credit)
- Amount of credit extended
- Details of the capacity of the individual (e.g. whether he/she is an account holder, joint account holder or guarantor)
- Credit account information (e.g. account status, open and/or closed date)
- Up to 24 months of repayment history information for commitments with a financial services organisation (e.g. payment obligation has been met or not)
- Credit provider details
More data will soon be available on your credit file which will demonstrate how well you pay your banking credit obligations. If you pay your bills on time, this change will have no impact on your credit standing.
If you don’t pay your bills on time, credit providers will see your payment history and will be able to decide whether or not they wish to extend credit to you based on this information.
Importantly, if you’ve had a payment issue in the past, this information will allow you to demonstrate to credit providers that you’ve rectified your slip up through a series of on time payments.
First, it’s important you take the time to order a copy of your credit report and familiarise yourself with the information it contains. It’s worthwhile doing that now, even though the new information won’t appear on your file until 2014.
Make sure you check that all of the data is correct – if you note anything on your file that you believe shouldn’t be there you can contact the credit provider or illion’s Client Services team at 0800 733 707.
You can also subscribe to an alert service which will notify you in the event that data on your credit file changes. This is a good way to prevent fraud as you will be alerted immediately to someone using your details and can act quickly to notify the appropriate authorities.
For tips on achieving a strong credit file read ‘Managing your credit history’