Experian and FICO have implemented new metrics for calculating consumer credit scores. The idea is to help consumers raise their score and increase their ability to take out loans on a more conventional means.
One of the new platforms Experian is rolling out is called “Experian Boost”. Boost allows consumers to report accounts such as utilities to their credit report. The idea behind Boost is to report the pay history we have such as our water, cable, cell phone or other utilities which in turn will be calculated accordingly to raise the scores if the accounts were always paid on time. This allows consumers some control over what is reported on their Experian credit report. According to consumer affairs, Experian tested this new platform on thousands of users and claimed two-thirds of the customers saw an improvement of their score. Depending on the prior score of the consumer, they saw an increase of anywhere between 10-15 percent improvement. Reporting utilities could be a useful resource which consumers can use to give them a stronger purchasing power.
Unfortunately, the same cannot be said when it comes to the other rollout Experian is running called “UltraFICO Score”. UltraFICO Score is a reporting system which the consumer give Experian their checking and savings account information. With this, what could possibly go wrong? Right?
Not even close to right. Have no doubt, a lot can go wrong.
First, remember the Equifax data breach? Imagine what could have happened if you had given Equifax your checking and savings account information. It is a painful enough experience having to deal with identity theft, but imagine having to deal with money taken from your savings and checking account on top of everything else. Listing your checking or savings account with Experian could result in identity theft like we have never seen before.
Secondly, consider that none of us know the future. We do not definitively know that we will be working at the same job, or even working at all. What happens if life throws us a curveball and we end up in a not so good place and cannot pay our bills? Your creditors will send any unpaid debt to a third party collection agency, and that collection agency will pull your credit report (as they would have permissible purposes to do so) and see exactly where your money and assets are. By giving Experian or any of the three credit reporting agencies your checking information raises the risk of a debt collector locating your asset information and taking your rights away to dispute a debt and sue you. Is it really worth the extra maybe at best 5 points on your credit report to risk this?
The third consideration which should not be overlooked, we live in a world where “data” is our most valuable asset. Companies, especially ones as large as Experian and other credit reporting agencies absolutely sell your data to other companies. As unethical and scary as it is, your data is sold over one hundred times for every one time you apply for something online. Is it worth having your checking and savings account also sold?
Your data is already not safe. Your identity is not safe. But why make is easier for large corporations to bring harm to you?