While previously credit providers only reported applications for credit and defaults (a payment more than 60 days overdue), consumers should be aware that under new reforms, if you fail to make a loan or credit card payment on time from December 2012, your credit provider may report this to a credit reporting agency.
The Privacy Amendment (Enhancing Privacy Protection) Act 2012 (Cth) was passed on 29 November 2012 and received royal assent on 12 December 2012. As part of the reforms to the Privacy Act 1988 (Cth), new kinds of credit-related personal information can now be collected about you.
This may not only affect your ability to obtain credit in the future, but could also have significant implications for people applying for home loans, particularly first home buyers. It may also mean those with a history of late payments may be subject to higher interest rates on loans than those with a history of paying on time.
The type of information credit providers will be permitted to collect and report includes whether you have made a payment on time or whether you have missed a payment. If you only pay part of the amount owing, you will also be taken to have missed a payment.
What can you do to protect your credit history?
Under the changes, credit providers can only collect information about payments that you have made or missed from December 2012. From March 2014, licenced credit providers will be able to pass this information on to credit reporting bodies such as Veda or Dun & Bradstreet. Credit providers may then use this information to help determine your eligibility to be provided with credit.
Get a credit history report
We strongly recommend people concerned about their credit history obtain a free copy of their credit report from a credit reporting agency.
You can review the information held about you and if you believe that information is incorrect you can request the credit provider or credit reporting body correct the information. For a small fee, it is also possible to register with a credit reporting agency for a service that notifies you when there is a change to your credit record.
What if you have concerns about your credit history information?
If you believe that a credit provider or credit reporting body has handled your personal information inappropriately, you can also complain to the relevant credit provider or credit reporting body.
If you are not satisfied with the response to your complaint, you can complain to an external dispute resolution scheme of which the credit provider or credit reporting body is a member, or to the Office of the Australian Information Commissioner.