In early November, Treasurer Scott Morrison announced the Federal Government would implement mandatory comprehensive credit reporting (CCR) from 1 July 2018, as recommended by the Productivity Commission.
The CCR regime will be introduced with the Big Four banks and is likely to be rolled out to other credit providers in the Australian market, according to finder.com.au. The new regime will provide lenders with a better understanding of a borrower’s risk profile and their propensity to service debt.
For borrowers with a good credit history, the new regime and availability of data are likely to provide them with greater access to more competitive products.
According to a recent finder.com.au survey of 2,033 respondents, 67% of Australians believe a sound financial history should provide them with access to cheaper interest rates. Angus Raine, Executive Chairman of Raine & Horne, noted: “This change will be fantastic for first home buyers who are just coming to grips with their finances and who are seeking a suitable first home loan.
“More comprehensive credit reporting will give consumers realistic and factual figures to work with, which will take some of the emotion out of the borrowing process.”