The Financial Conduct Authority (FCA) has unveiled proposals aimed at tightening information-sharing rules between lenders and credit reference agencies, in a move designed to address gaps in consumer credit files and strengthen lending decisions across the UK.
Under the consultation, lenders that provide borrower data to one designated consumer credit reference agency (CRA) would be required to share the same information with all designated CRAs, claims ShareCast.
The regulator believes this step will help eliminate inconsistencies in credit files and ensure that lending decisions are based on more complete and accurate data.
CRAs play a central role in the UK’s lending ecosystem, collecting and maintaining data on individuals’ borrowing histories, including repayment behaviour and outstanding credit commitments. Banks and other lenders rely heavily on this information when assessing affordability and determining whether to approve new loans or credit facilities.
However, the FCA has warned that when credit reference agencies hold only partial or fragmented information, it can create significant challenges for both consumers and firms. Incomplete files may lead to individuals being unfairly declined for credit or facing additional barriers when applying for loans. At the same time, lenders operating with limited data may inadvertently expose consumers to unaffordable borrowing or fail to identify potential risks, including fraud and errors in reporting.
The regulator argues that the proposed changes would improve the overall integrity of credit files and create a more level playing field in the market. By ensuring that designated CRAs receive the same data from lenders, credit records would more accurately reflect an individual’s financial circumstances, reducing discrepancies between agencies and improving transparency.
FCA director of consumer finance Alison Walters emphasised the importance of high-quality data in supporting responsible lending. “Access to affordable credit relies on good quality data – it’s vital in helping consumers navigate their financial lives. That’s why we want to make sure everyone’s credit information is as full and accurate as possible,” she said.
The consultation signals a broader regulatory focus on data accuracy and consumer protection within the UK’s credit market. By strengthening data-sharing obligations, the FCA aims to reduce the risk of consumer harm while supporting firms in making more informed and sustainable lending decisions.
If implemented, the proposals could mark a significant shift in how credit data is distributed and managed across the UK financial services sector, reinforcing the importance of comprehensive data in promoting fair access to credit.
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