Credit card firms share data to find debt-risk customers

Tuesday, 25 November 2008 08:01

UK credit card companies are to starting to share information about consumers in a bid to stop people falling into debt trouble.

From December, five credit card companies - Barclaycard, Capital One, GE Money, HBOS and MBNA - will be sharing 'behavioural data' on their customers' accounts.

The industry claims the data will be shared to help to identify and assist people who may be starting to experience financial difficulties.

Traditionally, shared data for credit cards has included the customer's balance, credit limit and whether payments are up to date only.

Now firms will be sharing: the amount of customers' last payment, and whether this was equivalent to the minimum payment; changes to credit limits; the extent to which they withdraw cash on their account and if the customer is signed up to any promotional deals such as 0% introductory offers.

Those deemed to be relying on credit cards to make ends meet could now be stopped from getting extra credit cards.

Peter Tutton, senior policy officer at Citizens Advice, welcomed the move as a way of stopping people getting into debt problems.

"We believe that it is increasingly important that customers who are showing signs of experiencing debt stress are identified at an early stage, so that appropriate help can be provided," he said.

"It is now imperative that lenders make full use of this additional information as part of an ongoing commitment to responsible lending."

Paul Rodford, head of card payments at payments association Apacs, said: "Our announcement today is not a silver bullet for tackling over-indebtedness, but it is a significant step forward in the card industry's ongoing commitment to responsible lending.

"It has taken a great deal of work and investment to achieve and should bring real benefits for the consumer."

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