This is the second in a three-part interview between Experian’s Tom Whitfield and Dr. Michael Turner, founder, president and CEO of the Policy and Economic Research Council (PERC)—a non-partisan, non-profit policy institute devoted to research, public education, and outreach on public and economic policy matters.
Dr. Turner is a prominent expert on credit access, credit reporting and scoring, information policy, and economic development. Mr. Whitfield is the Director of Marketing for Experian’s Telecommunications, Energy and Cable practice.
In this post
Dr. Turner explains how full-file credit reporting actually benefits consumers and why many communications providers haven’t yet embraced it.
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Why is full-file credit reporting good for communications customers?
Approximately 54 million Americans either have no credit report, or have very little information in their credit reports to generate a credit score. Most of these “thin-file/no-file” persons are financially excluded and many of them are media and communications customers.
By having their payment data fully reported to a credit bureau and included in their credit reports, many will be able to access affordable sources of mainstream credit for the first time; others will be helped by repairing their damaged credit. In this way, consumers will save by not relying on high-cost lenders to have their credit needs met.
Why don’t providers embrace reporting like other major industries/lenders?
A major reason is inertia—providers haven’t done it before and are not sure how they would benefit from change.
Just recently, PERC released a major study highlighting the business case for fully reporting customer payment data to one or more nationwide credit bureaus. This includes customer survey results, peer survey results and case studies. The results all point to tremendous upside from fully reporting payment data, with only manageable downsides—including external communications and regulators.
Misperceptions and misunderstandings
Another significant reason is regulator misperceptions and misunderstandings. State public service and public utility commissions (PSCs and PUCs) aren’t experts in credit reporting or the regulatory framework around credit-information sharing. Many mistakenly believe the data is unregulated and can be used for marketing.
Not wanting to contribute to an increase in commercial mail and telemarketing calls, some regulators have a knee-jerk reaction when the topic of credit reporting is raised by an interested media, communications or utility company.
PERC has been working to educate regulators and has had success in their outreach efforts. PERC can be a resource to firms interested in full-file reporting in direct communications with regulators.
Part 3: Wednesday, June 29
Next, in the concluding post of this interview with PERC founder, president and CEO Dr. Michael Turner, the doctor discusses mandatory credit-information sharing for communications companies, and the value of engaging and educating state regulators.
Agree, disagree or comment
Whether you agree with Dr. Turner’s assertions or not, we’d love to hear from you. So please, take a moment to share your thoughts about full-file credit reporting in the communications industry.