A credit bureau is a company that collects information from various sources including credit furnishers and third-parties and provides credit information on individual consumers for a variety of uses. It is an organization providing information on individuals’ past and present borrowing and bill-paying habits. Credit bureaus are sometimes referred to as Credit Reporting Agencies (CRA).

Most consumer credit information is collected and kept by the four major national credit reporting agencies: Experian (formerly TRW Information Systems & Services and the CCN Group), Equifax, TransUnion, and Innovis (which was purchased from First Data Corporation in 1999 by CBC Companies).

These organizations are for-profit businesses and possess no government affiliation. Though they are competitors, they have formed a trade organization called the Consumer Data Industry Association (CDIA) to establish reporting standards and lobby on behalf of their industry issues in Washington.

Data furnishers are entities such as creditors, lenders, utilities, debt collection agencies, etc…, that report a consumer’s repayment/debt history to the credit bureaus.

Data furnishers are subject to the compliance of the FACTA, FCRA, FDCPA, FCBA, and HIPAA laws and reporting 100% accurate information.

The laws that govern the credit reporting industry are;

The oversight of the credit bureaus and those that furnish data to them are handled by three government entities.

The Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) have oversight for the consumer credit bureaus and furnishers.

The Office of the Comptroller of the Currency (OCC) charters, regulates, and supervises all national banks with regard to the data they furnish credit bureaus.

There are dozens of other similar information collection and reporting firms (credit bureaus) that analyze and sell information about consumers for other purposes, including those who aggregate multiple credit data sources and provide lenders with customized analytical tools.

For example, PRBC (Payment Reporting Builds Credit, Inc.) is a national alternative credit bureau. Incorporated in March 2002, PRBC enables consumers to self-enroll and build a positive credit file by reporting their on-time payments (such as rent, utilities, cable, and phone) that are not automatically reported to the three traditional credit bureaus.

Here is a list of alternate credit bureaus you may not be aware of.

In the United States, 79% of credit reports provided by credit bureaus contain inaccuracies.

According to the U.S. General Accounting Office (GAO), common causes of errors broadly fall into one of two categories: inclusion of incorrect information and exclusion of correct information.

The reasons for the inaccuracies include consumers providing inaccurate information to the credit bureaus.

Incorrect or incomplete data input by furnishers, failing to provide data to the credit bureau, and incorrect or incomplete data (or data applied to the wrong consumer) by the credit bureau.

According to Credit Report Accuracy and Access to Credit, “the parties that bear the costs of correcting errors or providing more timely and complete information [data furnishers and credit bureaus] may not receive much benefit from the improvement in accuracy.”

This means that it’s more cost-effective for the credit bureaus to report incorrect information than to investigate a credit file and correct the data.

No.

The credit bureaus also maintain a VIP database of special consumers such as members of congress, senate, judges, actors and celebrities.

The VIP database is specially administered by the bureau, which ensures the credit report of the consumer is accurate and not negatively handled.

The database exists because individuals in the VIP database could cause significant problems for the bureaus, including negative publicity and legislative action which could adversely affect the industry.

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