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Not All Credit Providers Update Information Monthly

Credit Bureaus have been very good at marketing their services to credit providers (to help them manage their risk) and more recently to consumers. They have, for years, told people that your credit score is vital and you should worry about it. Why?

When Does Your Credit Score Get Used?

If a consumer can afford to repay credit then they should be able to access credit from all credit providers (shops and banks etc). 

When credit providers decide to risk giving a consumer a loan they have to decide what interest rate to offer the loan at. While you may assume it will always be the maximum allowed this is not always the case.

‘Credit providers can decide to lower the rate to try to win over the consumer to get credit with them rather than another credit provider’

Credit providers can decide to lower the rate to try to win over the consumer to get credit with them rather than another credit provider. This is where the consumer’s credit score comes in as this can be used to figure out what rate they will offer the credit at. The better the score, the lower the rate might be dropped (with a little negotiation and haggling maybe).

It can also influence how big of a credit limit for things like an overdraft you might be granted.

What Shows On Your Credit Report May Not Be Up To Date

You may be surprised to know that credit providers do not all automatically update all your credit activity to all 13 registered credit bureaus each month.

Because it costs credit providers to place information about consumers onto the credit bureau some credit providers reduce costs by:

(1) only adding current info to 1 credit bureau

(2) adding info every 3rd month

(3) some only report big credit events (as opposed to regular monthly payment info etc)

Since paying regularly and well, to them, is not a big credit event this actually means that your credit score will fluctuate as they do and don’t capture payment info over time.

Most Big Credit Providers Do

While some smaller credit providers take these shortcuts it is good to know that the major credit providers, like the banks, almost all submit info regularly to the bureaus (most of the bigger ones anyway).

Since these are the people that consumers borrow from the most this means that your credit report and score will be mostly accurate, if you are not making use of one of the smaller credit providers who report inconsistently.