Increase in credit report requests due to recession?
Posted June 5th, 2009 Equifax, the largest credit reporting firm in the UK, has reported an increase of 10% in requests for reports. They attribute this trend to the reduction in the amount of credit available to borrowers, and the subsequent harsher criteria for borrowers.
What seems to be happening is that consumers are now more regularly being rejected for credit cards, loans and mortgages, and subsequently ordering credit reports to determine the cause of the issue. Due to the economic downturn, credit card providers are being a lot more careful with the people they give credit to. An article in the Financial Times suggested that the approval rates for loans and credit cards had decreased by almost 40%.
Neil Munroe, external affairs director of Equifax states:
“Previously, a consumer might not have challenged the reasons for being declined because they could get credit elsewhere,“But now, with more stringent lending criteria meaning that more consumers are unable to obtain the right product or rate, they are likely to start challenging the lender’s decision which is, in turn, requiring lenders to be better focused on how they deal with consumers who may not meet their own risk criteria.”
Industry codes dictate that financial institutions need to provide a reason as to why the request for credit was declined, however many can get away with simply telling consumers that their credit score was too low.
This in turn has lead to the increase in requests of people asking for reports, to determine why their credit score was did not meet the requirements.
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Comparison of Top 10 Credit Card Offers
| Credit Card | Card Details | Interest Rate | Cash Advance Rate | Balance Transfer Rate | Annual fee | Interest free days | ||
|---|---|---|---|---|---|---|---|---|
 Halifax All in One Credit Card |
The Halifax All in One credit card offers a great introductory rate, and is perfect for saving you money now as well as in the future. | 15.9% APR | 27.95% p.a. (variable) | 0% for 9 months | No Annual Fee | 59 Days interest free |
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 Virgin Credit Card |
As well as a great rate, the Virgin Credit Card comes with:
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16.6% APR (variable) | 27.9% p.a. (variable) | 0% for 16 Months (2.98% fee on balance transfers) | No Annual Fee | 50 days on card purchases |
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 Capital One Classic Visa |
This card is designed for people with bad credit ratings, this is why the rate is quite high. |
Typical 34.9% APR variable | 34.9% APR | 34.9% APR | No Annual Fee | 56 days for purchases. 0 days for balance transfers and cash. |
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As well as earning Flying Club miles which you can spend on brilliant rewards like flights, upgrades, car hire and more, a Virgin Atlantic Credit Card gives you up to 46 days interest free on card purchases. |
17.9% APR typical rate | 20.9% p.a. (variable) | 0% for 6 months (2% handling fee) | No Annual Fee | Up to 46 days on card purchases only. |
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The Virgin Prepaid MasterCard from Virgin Money is a prepaid Mastercard that you can add funds to, and use these funds for normal purchases. |
N/A | N/A | N/A | N/A | N/A |
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5% cashback on purchases in your first three months (up to £4,000 of spend). Thereafter, earn 0.5% on the first £3,500, 1% on £3,501 to £10,000, and 1.5% after £10,001. |
18.9% p.a. | 27.9% p.a. | 18.9% p.a | No Annual Fee | 56 days for purchases. 0 days for balance transfers and cash. |
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Vanquis Visa Card is designed for people with no credit history or who have previously had bad debt. |
39.9% APR variable | 39.9% | 39.9% | No Annual Fee | Up to 56 days on card purchases only |
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The award winning prepaid card with no credit check or bank account needed. | Funds in your Account will not earn interest | Prepaid only - N/A | Prepaid only - N/A | £59.40 p.a. (£4.95/month) | Prepaid only - N/A |
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