Major Bank Backs the Call for More Credit Card Data Sharing

Commonwealth Bank, one of the largest providers of credit cards in Australia, is openly backing a proposal for an increased amount of information on the credit histories of consumers to be made available.

A industry report produced earlier this year calls for a more detailed system of credit reporting, and argues that the introduction of an increased information flow would do much to reduce the overall number of Australians finding themselves with a debt related problem.

Currently, credit card providers and lenders only have access to limited data such as defaults and applications for credit. They have no way off assessing the overall level of debt currently carried by prospective clients. This situation leaves the doors wide open for an individual to accrue a stupendous monthly debt over a very short period of time.

The chief executive of Commonwealth Bank, Mr Ralph Norris has been quick to lend his support for the new data reforms at a recent credit card summit. He indicated that he completely agrees with data being shared more fully between credit card providers. He stated at the summit that “The information is essential if we're to avoid the industry offering more credit to people who are already over-committed,” and that “We've led the industry in advocating this reform in the interests of responsible lending, and it will be a positive step for the industry moving forward.”

Mr Norris continued by stressing that the current world financial crisis could continue for two or more years, and had already pushed the cost of offshore money up for borrowers and banks alike. He informed the summit that there were current estimates that indicate a further $700 billion or more in sub-prime debt write-offs were approaching. By reinforcing his statements with such a dire statement, he was clearly indicating that he feels the current situation is fragile in the extreme. Indeed, in his closing statement he said that, “ from my perspective, I would suspect that we're looking at least another 12 months to two years before this particular crisis actually works its way through.”

With the consumer credit industry in general and the credit card industry specifically facing such steep problems, it can only reinforce the need for consumers to find the best credit card offer they can with the best interest rate, and take advantage of low rate balance transfers to reduce their personal debt to a minimum.