[1] More than happy to be corrected here with sources, I just have not ever heard about Equifax-like company in Europe
Most companies giving you a credit of some sort (banks, phone contracts, ...) are required to do vetting of you.
To help them do that, they use credit rating bureaus.
In Europe, you as a private person just don't know it and don't have access to your own rating. But you are likely to be rated anyways..
Here is one danish example (at least three exists)
https://translate.google.com/translate?sl=da&tl=en&u=https%3...
In the E.U., there are no private organisations who can process your personal data without making it available to you on request.
In Ireland, there's a state-run Central Credit Register, to which lenders must submit any consumer credit agreement above €200, and which they must check by law before issuing credit. Anyone can apply online to get their credit history from the CCR, and make submissions to correct inaccuracies.
There's also the Irish Credit Bureau, a private organisation with a similar purpose. They are also required to reveal data held about you on request, and correct inaccurate data held.
https://www.bancaditalia.it/statistiche/raccolta-dati/centra...
and I believe that in the end (now it is partial/experimental/in the works AFAICU) there will be an European Registry at the BCE (Anacredit):
https://www.ecb.europa.eu/stats/money_credit_banking/anacred...
Though there is no "public" access to the data in the Centrale Rischi, you can have it going in person to the Bank of Italy, the issue is that - if you find an error/mistake - it must be corrected by the bank/agency/whatever that made the erroneous entry, and this can sometimes be a nightmare, not so much with banks, but with smallish financial service agancies (that might have - in the meantime - changed property or going in default, etc.).
> AnaCredit is a dataset with detailed information on individual bank loans in the euro area. The name stands for “analytical credit datasets”. The ECB launched the project in 2011 – together with the euro area and some non-euro area national central banks. It uses data and national credit registers to achieve a harmonised database that supports several central banking functions, such as decision-making in monetary policy and macroprudential supervision.
In Denmark I'm mostly aware of RKI, which seems to be owned by Experian now. If you fail to pay your loans, you end up on that bad payer list. Otherwise getting a loan is a private matter between you and your bank unless you want to use a third party lender
The Wikipedia snippet:
The credit scoring is widely used in Denmark by the banks and a number of private companies within telco and others. The credit scoring is split in two:
Private: The probability of defaulting
Businesses: The probability of bankruptcy
There are a few companies who have specialized in developing credit scorecards in Denmark:
Experian (generic rating for business)
Bisnode (generic rating for business)
I really hope they leave the EU and stop bothering us with their shitty ideas, credit reference beeing one
We don't want national identity cards; the Blair government tried to introduce them in 2006 and failed due to massive public opposition. We think it's a bit weird that other EU nationals are so tolerant of the government having a massive centralised database tied to a single token.
https://en.wikipedia.org/wiki/Identity_Cards_Act_2006
>For a long time, no pin code on credit card, so that theft is easier
Most of our debit card market is Visa/Mastercard, so we switched to Chip and PIN in 2006 - the same time as most international markets. Some European markets had their own local debit card schemes but these schemes were far from perfect.
>Basically they keep the stuff which trick the consumer, whereas in Europe they make law to protect consumer.
Last time I checked, we were still in the EU and still subject to EU law. We implemented the GDPR (and our regulator is one of the most proactive in actually enforcing it), we implemented the Consumer Rights Directive and we were well ahead of the curve in many areas, particularly distance selling and consumer finance.
Surely there’s some third alternative other than “incompetent credit bureaus enable fraud” and “minorities have bad access to credit because lenders are super racist”?
Also except for the risk that financial problems will force a cardholder into accruing interest, and often that interest will get a lot worse if payments are missed a 5% card changes into a 22% card if more than some number of payments are late and some number may be just 1.
I hope I have bought enough street cred to say the following by ghostwriting hundreds of letters to the credit reporting agencies to fix their problems, which are numerous and essentially inevitable given their model and present operations.
Credit scores are important because they allow banks to do standardized, automated underwriting for effectively free at 2 AM in the morning, which is what makes credit abundantly available in the United States and one of the reasons why it is so cheap to the middle class. (This routinely escapes the notice of people in the middle class, but the ordinary operation of banks is to advance well-organized people money for free and pay you to be chosen to do so, partly due to credit scores making this a derisked proposition and partly due to interchange revenue.)
Credit scores decimated the costs of unsecured consumer loans, as is readily observable by seeing what loan availability, pricing, and the "credit box" looks like when they're not available for underwriting. (This is a term of art in consumer credit that I provide for your future Googling pleasure, not having enough time to explain it at the moment.) Compare the cost on a cash advance on any card in your wallet to a payday lender. That delta is substantially (not solely) due to credit scores, both in improved understanding of default risk and in reduced operational cost (of underwriting and servicing, both enabled by the scoring infrastructure).
Credit scores are an important justice-enhancing technology because they make the inputs to an underwriting decision objectively observable and for the first time in history those inputs provably do not include race, religion, etc.
There is an argument which is not immediately dismissible that credit scores are based on borrower behavior which reflects the socioeconomic realities of the United States and therefore somehow effectively encode race, but it is an obvious improvement that banks now mechanically reach the same decision on similarly situated white and black borrowers. Regulation did not make that happen. FICO did.
I think well-off computer programmers should understand that there is a societal tradeoff which buys "middle class black Americans have the same access to credit you do" at the cost of Equifax knowing your credit limits; understand that if you are advocating for rolling back the second you should accept that ceteris paribus we will experience material disimprovement on the first.
(Obligatory disclaimer: personal opinion here.)