Press Release

FLA CALLS FOR PUBLIC SECTOR DATA TO BE SHARED

12 January 2007

The Finance & Leasing Association (FLA) today called for public sector data to be made available to lenders to help them better assess the danger of over-indebtedness.

The DTI consultation on non-consensual data sharing gauges views on whether data collected before “fair processing notices[1]” were introduced should be shared.  In our response, we acknowledge the balance to be struck between potential concerns from a privacy perspective and the benefits of collecting such data. However, FLA believes that the addition of non-consensual data to credit reference bureaux records of consumers’ credit commitments, would be a significant step in enabling lenders to understand the full spread of a consumer’s indebtedness. In addition, we would like to see government and utilities data shared, such as council tax payments, gas and electricity payments (and especially arrears) and student loan data.

FLA was concerned by the suggestion contained with the DTI paper that the consumer have the option to object to data sharing on “historical” accounts[2]. There is a danger that the consumers most likely to take advantage of the opt-out would be the ones most exposed to credit, and therefore the ones who are most at risk of over-indebtedness. FLA would like to see all non-consensual data on credit commitments shared.

Commenting on the FLA response to the DTI consultation FLA Director General, Martin Hall, said:

“FLA have always been strong advocates of increased data sharing. Our members feel that the more data they have, the more likely they are to make the correct analysis of an applicant’s current exposure to credit and thus the lending decision is likely to be more responsible.

“However, I would emphasise the importance of getting data on other, non-consumer credit, commitments such as student loans, council tax and utility payments. These are amongst the best indicators of financial difficulty available.”

FLA’s response is available at http://www.fla.org.uk or on our epolitix micro-site