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Consultation on the removal of barriers to the sharing of non-consensual credit data

Starting Date: 11-10-06

Closing Date: 11-01-07

The Government is keen to promote responsible lending in the credit market as part of its strategy to minimise over-indebtedness. One aspect of responsible lending concerns the making of lending decisions. Lenders are encouraged, wherever practicable, to consider the full extent of a consumer’s credit commitments when deciding whether or not to lend to that individual. This is usually achieved through the sharing of credit data via Credit Reference Agencies.

The consumer gives their permission to the lender to share their data via a “fair processing” notice contained within the credit agreement. However, accounts opened before the late 1990s typically did not contain such fair processing notices. In practice this means that lenders are unable to share data, other than instances of default, on about 40 million accounts (of which about 33 milllion are estimated to be current accounts). This is compared with around 350 million accounts on which data is currently shared.

The Government takes people’s rights to privacy very seriously and wants to strike the right balance between individual rights and the wider public interest. This consultation therefore seeks views on the extent to which this non-consensual credit data could be shared by lenders, subject to appropriate safeguards, in order to enable lenders to make better, more responsible, lending decisions.

Consultation Documents

• Consultation on the removal of barriers to the sharing of non-consensual credit data: includes partial RIA (835KB)