Credit Report Sales to Consumers

Financial institutions are beginning to respond to their customers' interest in credit scores and credit histories. Banks and other financial institutions are beginning to forge partnerships, to varying degrees, with the major credit bureaus to meet customer demand for information about their creditworthiness. A recent article by Lavonne Kuykendall in the American Banker illustrates the spectrum of strategies. She reports that Wells Fargo refers its Web site visitors to Equifax in exchange for a referral fee. Citigroup sells Experian credit reports under Experian's name. American Express sells Experian credit reports under the American Express brand name.

The three major credit bureaus have adopted different strategies for making credit reports available to consumers. All three make reports available for sale on their own websites. Experian has recently started encouraging financial institutions to re-sell its credit reports to their customers. Equifax has partnered with Fair Isaac & Co. to run the www.myfico.com website and offer Score Power, a product that gives consumers a combined credit report and risk score. Both Equifax and Experian offer products to consumers that explain the content of credit reports and show consumers how their actions affect their scores.

At the Equifax site, consumers are offered a choice of three products: Credit Profile (a one-time look at a credit report for $9); Score Power (a combined credit report and credit score for $12.95) and Credit Watch (a one-year subscription to bureau reports for $69.95). Equifax reports that over the past year it has sold Credit Profile 590,000 times and Score Power 440,000 times. Between 150,000 and 170,000 customers are enrolled in the Credit Watch service. Experian would not release its sales figures but said that it is averaging over 105 million visits to its website per month.

At the American Express website for its new Trackstar service, customers get personalized tips on how to improve their credit score, plus customized graphs that illustrate the customer's spending habits. The site will allow customers to perform "what if" scenarios for major purchases and debt payoff, and will offer email alerts to subscribers warning them if a creditor reports a late payment or a new credit inquiry. This service is being billed as a protection against identity theft and fraud.