Magazine article American Banker

Eyes on Credit: Banks Seek Utility Data to Shed Light on Credit Risk

Magazine article American Banker

Eyes on Credit: Banks Seek Utility Data to Shed Light on Credit Risk

Article excerpt

Reasoning that people who pay utility bills on time would be equally diligent about credit card bills, bankers are trying to get access to credit bureaus' data on utility subscribers.

The credit information companies currently keep utility information separate from the credit reports they sell to bankers. One reason is that consumers want it that way, but also many state regulators frown on such information sharing as a violation of privacy.

Nevertheless, the credit bureaus are eager to sell the data to bankers.

It "would be a revenue opportunity for us as much as for anyone else," said Jeffrey L. Dodge, senior vice president of Equifax Inc., Atlanta. "Because of state laws, we don't have a good climate for putting this information in credit files."

Pressure from credit card lenders-whose quest for new marketing outlets is more ardent than ever-may change the situation, Mr. Dodge said. Talk of merging utility data bases with consumer credit files has recently gotten serious.

In March, Equifax formed the National Consumer Telecommunications Data Exchange, a consortium of long-distance telephone providers. Some participants are amenable to the idea of sharing credit information with bankers.

Consortium members AT&T, MCI Telecommunications, and Sprint are giving Equifax the names of customers who have not paid their phone bills and had their service disconnected, as well as new customers applying for service. So far, Equifax has gathered seven million records.

Trans Union Corp. of Chicago began marketing similar data bases earlier this year to the gas, electricity, telephone, and cable industries. …

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