Credit Reports and Creditworthiness
Key Takeaways
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Banks may use your credit report to assess your financial situation
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Every default or late payment leaves a mark on your score
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Learn good money habits to ace your future credit report
What Is A Credit Bureau?
A credit bureau is an agency that collects and stores information on your credit history, such as loans, credit card applications and repayment records.
Information in the credit report is provided by members of the credit bureau such as banks and credit card companies, and obtained from public sources on bankruptcy.
Approved Credit Bureaus
For banks and finance companies, only two credit bureaus are allowed to obtain such information in Singapore. They are Credit Bureau (Singapore) and Experian Credit Bureau Singapore (ECBS).
For licensed moneylenders, the Moneylenders Credit Bureau (MLCB) is the central repository of data on borrowers’ loans and repayment records with licensed moneylenders. It allows licensed moneylenders to assess the creditworthiness of borrowers and help borrowers avoid borrowing beyond their means.
What Is A Credit Report?
A credit report is a compilation of your credit payment history collected across all your banks. It is issued by a credit bureau to banks, finance companies and credit card companies when they make enquiries about you. You may also request a copy of your report from the bureaus.
The credit report includes information such as:
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Basic personal profile data (excluding contact addresses and telephone numbers)
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Records of all credit checks made on you
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Credit repayment trend for the past 12 months, including late payments on credit card bills
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Default records, if any – displayed from the date it was uploaded to the credit bureau
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Bankruptcy records, if any – displayed for five years from the date of discharge. If you are able to repay your debts in full, the Bankruptcy Order will be annulled and your bankruptcy record will be removed immediately
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Closed or terminated credit accounts – displayed for three years from the date the account was reported closed or terminated
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Aggregated outstanding balances
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Aggregated credit limits
Why It Matters
The credit score on your report shows how likely you will repay your debts.
Banks will assess your creditworthiness by looking at the credit score. The score helps them make better lending decisions when you apply for loans and credit cards.
A good credit repayment history makes it easier for you to qualify for loans and credit cards in the future.
Factors That Affect Your Report
A number of different factors could affect your credit report:
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Credit you have now - This includes the number of accounts open or active that provide you with a credit facility
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Credit history - Long-established credit history shows that you are a reliable borrower
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Enquiry activity - Too many new applications or enquiries show that you are trying to take on more debt. Do not apply for a new credit card unless you need it
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Recent credit - If you have recently taken multiple new credit facilities within a short period, you may be overextending yourself
If You Disagree With Your Report
If you spot an error or disagree with some information in your credit report, write to the credit bureau about it. The credit bureau will:
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Speak to the bank that provided the data
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Post a notice in your credit report that the data is being disputed and is under investigation
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Inform you of the outcome
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If any amendment is made to your credit report, send the revised report to all banks who have made enquiries on you in the past three months
Tips On Keeping A Good Credit Score
To maintain a healthy credit score:
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Pay all your outstanding monthly credit in full
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Always keep track of the payment due dates and remember to pay before then
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Avoid too many sources of credit. It is easier to keep track of your repayments when you have fewer credit facilities
