In this day and age, information is important in doing business. There are specialized organisations that simply exist to gather information. And this does not mean only personal data for marketing, financial data about you and a lot of other customers are systematically collected by financial organisations called warehouses.
One of the most widely used and talked of information warehouses is called a credit reporting agency. They are mainly responsible for gathering data about your financial situation such as loans taken , debt not paid etc. whenever an individual requests for another loan or apply for a credit card, then these agencies provide your historical financial data to lenders such as banks, creditors and customers so that they can make informed decisions about their clients. The warehouse creates a rating scale or a score depending on your financial history, which is then used by the lenders to make their decisions. Visit https://www.eccreditcontrol.com.au/ppsa-ppsr/
As customers or individuals it is important to understand that these organisations do not make final decisions of your loan being approved or not, they are simply facilitators of information. Therefore they only gather and compile detailed reports as an when your bank or any other financial institution requests them to. But some of the bigger data warehousing companies go beyond simply gathering and reporting data, they actually go the lengths to aide their customers make informed decisions. In terms of data gathering, these organisations use many sources. They sometimes depend on publically available data and information sent from banks and other financial institutions. Therefore it is no surprise to know that many organizations you do business with will be sending detailed financial information to credit reporting agencies. Some of the most common sources used are:
Lenders: will report on moneys that have been borrowed in the past and details of when they were paid back or not.
Utility payments: sometimes the bills you have to pay such as utilities and others forms of expenses that occur frequently can affect your borrowing capabilities; therefore these types of data are also gathered.
Public records: any information relating to legal proceedings are also used to check if an individual has filed for bankruptcy in the past or not.
Some of the most common forms of data that are gathered and stored in these warehouses aide the organisation in identifying you and your financial status based on historical and current state. Some of the most common data types gathered are personal information, public records and trade lines. Personal information would most likely include data about your name, address, social security number, employment data etc. public records would cover areas such as tax payments, foreclosure etc. some of the most important data comes from a category called trade lines, which would include information on loans obtained, payments made, accounts status , liabilities to name a few. As an individual or businessmen it is important to know what your credit score is like, therefore periodical checkups on your standing will help you in your financial decisions whether it is business or personal.