Credit bureau Veda Advantage has called on the Government to make credit reporting law reform a priority and introduce comprehensive credit reports urgently.
This follows the release of the Australian Law Reform Commission’s (ALRC) report on privacy laws, ‘For your information: Australian privacy law and practice’, which recognises that credit reporting laws do not enable lenders to assess whether a person is struggling to meet their debt repayments.
According to Veda, credit reports currently show only 10 per cent of the information required to identify credit risk and the ALRC’s proposed changes will only increase this level to 32 per cent.
Veda is calling for account status and 24-month payment history to be added to the mix to improve the industry’s ability to assess credit risk.
“The review has taken 2.5 years to complete and in that time interest rates have risen seven times,” Veda head of external relations Chris Gration said.
“The ALRC proposals fail to provide early warning signs of a person becoming financially stressed.
“The report took 25 years to update, yet it still doesn’t align Australia with world’s best practice in credit reporting, meaning Australians will suffer.”
If approved by Government, the ALRC’s recommendations are expected to be implemented by December 2009.
