Perhaps you checked your credit report six months ago, and you decided that you should check it again today. To your dismay, you discover it’s dropped significantly.
If you had realised sooner, you may have taken action to reverse the damage. We have a look at whether credit bureaus should inform you when your credit score changes.
Tip: Find out today whether your score has changed by signing up with JustMoney
How often is your credit score updated?
Credit bureaus are responsible for the credit scores of millions of people. They gather this information from creditors, and then use formula to establish and maintain the scores.
On average, creditors submit information on their debtors every month, or every second month. This means that the bureaus will update your credit score in a similar timeframe.
As a result, your credit score may change according to this frequency, depending on your actions with your own creditors.
Should credit bureaus notify consumers?
According to Marissa Vorster, accountant at Taxless, there are many different factors that influence your credit score, and this adds to the frequency with which it can change.
It would be impractical for credit bureaus to reach out to every single South African every time their credit score changes. This would entail contacting millions of people each month.
Hiring staff to inform consumers when their scores change would be incredibly expensive. Alternatively, they could create an automated, digital system that reaches out to consumers when their scores change.
However, there are many other factors to consider here, such as whether the bureaus have everyone’s correct contact details, and the cost of setting up and managing such a system.
“Credit bureaus should not notify you of your scores. Instead, they should provide adequate information on how to manage your credit score and ways to keep a healthy credit score,” says Vorster.
The most effective way for consumers to stay up to date with their credit scores is for them to regularly check up on it themselves, and to make use of the educational information out there.
Take control of your own credit score. Sign up with JustMoney to check up on it as often as you’d like, for free.