The peak body representing Australia’s finance brokers says they would only back a recommendation by the David Murray led Financial System Inquiry to expand comprehensive credit reporting data if credit reporting agencies also lift their game.
The Inquiry’s final report recommends that lenders be given access to an expanded range of personal information from borrowers, which will allow products to be tailored to specific needs.
However chief executive officer of the Finance Brokers Association of Australia (FBAA), Peter White, says he is concerned how this information might be used.
“There are many questions that need to be answered before the public should be confident about providing even more personal information,” he said.
He pointed to the difficulty consumers have when dealing with credit reporting agencies, and said any increased credit information provided by borrowers would have to be matched by better access to credit reporting organisations.
“Credit agencies make mistakes regularly, and it is almost impossible to reach anyone on the phone.
“I have personally tried to talk to someone at one company without success and I’ve seen first-hand the mistakes they have made, which in one case took many weeks to fix.”
He said you couldn’t increase the amount of credit information provided without also dealing with the reporting agencies.
“One without the other will not work.”
The FBAA said other recommendations made by the Murray Inquiry were also worthy of mention, particularly making the current bank risk weighting system more competitive neutral.
“We support a level playing field when it comes to the ability of banks to lend. Why should mainstream banks have an advantage over second tier banks?
“Creating a level playing field will bring balance to the marketplace and enable all players to compete fairly. It will also provide brokers with more competitive options, which will benefit customers.”