Biden wants to change how credit scores work in America – By McKenna Moore (Fortune) / Dec 18 2020
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The credit industry isn’t working if you ask consumer advocates. The Big Three credit agencies—Equifax, TransUnion, and Experian—are black boxes, gathering and selling consumer data, grading us on our financial behavior without letting us in on how they do it, and perpetuating damaging racial disparities while they’re at it.
That’s why consumer advocates are calling for a public credit reporting agency, and why President-elect Joe Biden has adopted a proposal for just that from left-leaning think tank Demos.
The proposal suggests building a publicly run credit reporting agency within the Consumer Financial Protection Bureau (CFPB) that would eventually, over the course of seven years, replace the current for-profit credit system in America. The agency would be steered by consumer need rather than the bottom line, according to proposal author Amy Traub.
“Today, credit reports, which are issued by just three large private companies, are rife with problems: They often contain errors, they leave many ‘credit invisible’ due to the sources used to generate a credit score, and they contribute to racial disparities,” Biden’s plan for investing in communities through housing reads.
