Last week, Callcredit, the UK’s third-largest credit reference agency announced that it will soon offer free, full credit reports online with a new site called Noddle. Julia Kukiewicz, editor of Choose.net, takes a closer look…
From September, consumers will be able to log-on to view a full report rather than paying each month to access the site or signing up for a free trial (which, often, ultimately amounts to the same thing) with Experian or Equifax.
There’s a catch, of course. In fact, there are two.
Callcredit is the UK’s third largest agency but it’s a long way behind the two frontrunners. When you apply for a credit card, loan, mobile phone contract or sign up with a new broadband provider you’re far, far more likely to be assessed by those two and, when Callcredit is used, it’s largely in addition them.
To monetise the service, Callcredit will also offer a comparison service and premium report, so the full service isn’t not completely free, but it’s likely to be the former catch that really concerns the type of consumer who’s going to look up their credit report in the first place.
And the number of consumers falling into that ‘type’ is rapidly growing. Lenders have, according to them, eased up on consumers applying for borrowing in recent months.
But easing up isn’t the same as ending the squeeze and stories of rejected applications abound. That represents a big opportunity for the consumer arms of the reference agencies.
Callcredit will need to work hard to make sure that their disadvantage in the larger credit market isn’t a significant stumbling block for consumer engagement.
It’s definitely possible, not least because the reference agencies are just one method of assessment – lenders use their own information too and make their decisions based on profit concerns out of consumer control – which undermines any claims by the other companies to be a ‘one stop’ for credit services.
This is a guest post from Choose. The site covers rights issues, research and debate into the consumer credit card and more broadly personal finance markets.
