Financial literacy and fintech are empowering Australian credit consumers to participate in the evolution of opportunity taking place in Australia’s lending market, Luke Keller, CEO of getcreditscore.com.au, has told AB+F.
Keller’s web portal, first launched in 2014 as part of a push for transparency in credit reporting information by Equifax (which owns the credit bureau formerly known as Veda in Australia) and peer-to-peer lender SocietyOne, last week tipped the scales by assisting the millionth Australian visitor in obtaining their previously opaque, but nonetheless essential personal credit score.
A keen advocate for the democratization of financial literacy in Australia, Keller said he was pleased to have made a “real difference” in providing a million “free scores” as part of educating Australians to the possibilities independent financial literacy provides.
“Financial literacy is an essential life skill,” Keller said. “Currently there’s a lack of understanding among many Australians on finance fundamentals. Without which it’s difficult to select the finance product which best meets your needs."
"To ensure future generations are equipped to make sound financial decisions, it’s vital we do a better job of educating our children and young Australians on the importance of personal finance and basic financial concepts."
Keller said Australian consumers were becoming more financially savvy in finding, using and improving their credit score gains immediate advantage in the credit market.
“The finance industry plays a crucial role in educating Australian consumers about their credit behaviour and how to manage their finances responsibly to put themselves in the best financial position to access credit,” he said.
In the wake of the second round of public hearings into the performance of the big banks, Keller noted there’s demand for greater competition and better deals for the consumer.
He said there have been advancements in fintech that allow for more competition in the financial space and have given consumers a wider variety of credit options to choose from.
“Gone are the days of the black-and-white standard home loans or personal loans; we now have the opportunity to shop around for a loan that is tailored to our personal situation.”
According to Keller, “the first step to getting a better deal” is knowing and understanding individual credit score. As awareness grows, there is a parallel rise in consumer strength within a market notable for disenfranchised participants.
“Our data shows that only one in four Australians were aware that their credit score could be accessed for free in July 2016," he explained. "In just nine months since then, getcreditscore.com.au has given away 600,000 credit scores, which shows a real growing awareness among Australians about their ability to access their free credit score."
According to Equifax, where it is almost a given that consumers access credit reports in the mature credit markets, such as the UK and US, in Australia, consumer credit scores were only introduced in late 2013.
“So, it is important for Australian borrowers to know their score and how to improve it to ensure they get the best deal when applying for a loan,” Keller said.
“The availability of new lending products, combined with low interest rates, mean it’s a good time to be an Australian borrower.”