The Credit Information Market Study (CIMS), initiated by the Financial Conduct Authority (FCA), aims to enhance the quality and consistency of credit information in the UK. This initiative involves several key proposals designed to improve data sharing and reporting practices among financial firms and credit reference agencies (CRAs).
Key Highlights
- Mandatory Data Sharing: In-scope firms will be required to share credit data with designated CRAs to ensure more comprehensive and accurate credit information.
- Regulatory Reporting: A new reporting framework for designated CRAs will allow the FCA to monitor compliance and address potential issues effectively.
- Error Correction Standards: Data contributors will be mandated to adopt clear protocols for correcting errors and reporting satisfied County Court Judgments (CCJs) to improve transparency.
- Cost Implications: Firms must assess both one-off and ongoing costs associated with adapting IT systems, staff training, and compliance measures as part of these changes.
- Impact on Lending Practices: The reforms aim to facilitate better credit access for individuals with limited or no credit history, enhancing inclusivity within the lending sector.
- Long-Term Strategic Shifts: Firms are encouraged to invest in technology and innovation to meet evolving regulatory standards while also navigating increased competition and market dynamics.
Download below the implications of some of these changes and potential risks for firms.
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