What is a credit bureau?
A credit bureau is a business that monitors and records individual consumer credit activities. It is sometimes called ITC, because that was the only credit bureau in South Africa for a long time. Today there are four main credit bureaux that have been approved and registered with the National Credit Regulator (NCR) in South Africa. They are:
TransUnion Credit Bureau (based in America)
Experian Credit Bureau (based in Europe)
Compuscan Credit Bureau (based in SA)
XDS Credit Bureau (based in SA)
What does a credit bureau do?
These businesses provide credit providers or potential lenders with an idea of how you manage your credit. They do so by calculating your credit score based on a variety of factors. In short, they capture, update and store your credit history based on your financial activity. If you've managed your debt well, i.e. you pay it off consistently without missing payments, your credit score will be good. To lenders, you will seem like a safe borrower. On the other hand, you appear risky and credit providers are less likely to provide you with credit if your payment history shows that you often miss a monthly payment and fall into arrears.
The good news is that you can change your credit score by improving the way you handle your money. There are ways to show the bureaux that you have become more responsible. It takes some time, but if you do it right, your credit report will look a lot better and you will eventually be able to get credit again. At Libertine Consultants, we will give you advice on how to do this.
More about your credit report
Look out for our next three articles that will take a closer look at your credit report, what a good credit report should look like and what you can do to improve a negative credit score. In the meantime, feel free to contact a Libertine Consultant representative directly if you have any questions about credit clearance. We're happy to provide any assitance and information you may need!
Read Part 2 of the 4 part series.