What is credit information?

The information provided by the CRA comes from several sources but falls into two main categories - public information and credit account information.

Public information

The public information consists of:

• The Electoral Roll consists of information supplied to local authorities by householders each autumn. New registers are published each February. Lenders use this information to help them confirm names and addresses.
• County Court Judgments and Scottish Decrees, supplied by Registry Trust, which holds a list of judgments on behalf of the Lord Chancellor's Department.
• Bankruptcies, Individual Voluntary Arrangements and Administration Orders, which are obtained from the official London, Edinburgh and Belfast Gazettes or the Insolvency Service

Credit account information

The UK's major lending companies have agreed to share with each other details of their customers' credit agreements. This lets them check, when someone applies for credit, that the person applying has repaid other lenders in the recent past or is repaying current credit commitments.

In order for lenders to access each other's information, they store copies of their customer credit records with the credit reference agencies. The credit reference agencies acts as a go-between in the sharing process but does not own the information.

The credit account information held by the CRA is simply a copy of that held by all the different lenders. These lenders update the credit reference agencies database monthly.

Lenders who access this credit account information through the credit reference agencies are members of a scheme called CAIS (Credit Account Information Sharing).

CAIS is strictly regulated under a contract between the lender and the credit reference agencies and under the scheme's Rules of Reciprocity. Participating lenders can access credit account information only if they provide similar information to be shared and must abide by the strict rules that clearly define the purpose for which the information may be used.

Searches which leave 'footprints'

All of us would like to be well organised, but the day-to-day business of work and home life often gets in the way. It is when tragedy strikes that the real value of record keeping is revealed.

So don't let your own death or illness cause even more grief for your family and friends. Make a will and make a list of what financial commitments you have, who they are with, how much needs to be paid and when. Make sure it's always up-to-date and keep it with a copy of your credit reference file. In this way, if you are taken into hospital, or you die, someone can quickly and easily sort things out for you and make sure that the lenders involved know what the situation is.

You might also want to explain to members of your family and close friends how an up-to-date copy of their credit reference file, a will and a list of financial commitments can be used in this way. If you are to be the person sorting out their affairs, in the unhappy event of their death or long-term illness, then you will be helped if these documents are readily available

The Data Protection Act makes it illegal for companies to use this personal information without the consumer's consent.

Repossessions

Members of the Council of Mortgage Lenders share, through Experian, details of those people whose homes have been repossessed.

Fraud prevention

The Credit Industry Fraud Avoidance System (CIFAS) contributes to the credit reference agencies database to allow its members to guard against granting fraudulent credit applications. This shared information also protects the innocent victims of fraud, for example people who have had their credit cards stolen.

Gone Away Information Network (GAIN) members share information when a customer has moved without letting anyone know.