Consumers encouraged to check credit ratings

Consumers should make sure their credit bureau records are in good standing before applying for credit, the credit ombud Manie van Schalkwyk said on Thursday.

“Of all our cases last year, 70% of consumers contacted the Credit Ombud office for assistance after their credit application had been rejected due to a negative listing on their credit profile,” said van Schalkwyk in a statement.

“To avoid disappointment, it’s imperative for consumers to ensure the credit information held with credit bureaus is correct, prior to applying for credit.”

National Credit Regulator (NCR) statistics show that 199.26-million enquiries were made on consumer credit records for the quarter ended March 2011, an increase of 13% on the previous quarter.

This was up by almost 60% percent compared to last year.

“These statistics show more people are applying for credit compared to a year ago,” said van Schalkwyk.

“But according to the NCR, there was a marginal increase in the rejection rate of credit applications to nearly half of all applications — from 43.21% to 43.25% for the quarter ended March 2011.”

However, enquiries from consumers had decreased by 5% quarter-on-quarter.

“Most consumers leave it up to the credit provider to check their credit history with a credit bureau when applying for credit.”

Consumers are entitled once a year to a free copy of their credit bureau record from a registered credit bureau.

Consumers who think they are listed unfairly or that the credit bureau has incorrect information for them can get free assistance from the credit ombud.

“If we agree that a consumer’s listing is incorrect, our decisions are binding on credit bureaus and their subscribers, but not to consumers and businesses.” — Sapa

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