Rising credit checks catch borrowers

Businesses are using credit reporting agencies and debt collectors more frequently, sometimes for just minor debts, which can lead to consumers being barred from loans for up to seven years. A huge array of businesses are now using these credit reporting and collection services, from banks to electricity providers, telephone companies and local councils.

Legal Aid Queensland's consumer protection lawyer Loretta Kreet says that vague legislation as to what constitutes a credit provider means that people like plumbers and lawyers are getting their debts registered on reporting lists. She says that people like this having access to the system is unacceptable. It is becoming a way for businesses to force people to pay debts and we don't think this is legitimate, she said.

If a business or debt collector believes a customer is deliberately not paying a bill they will see it as a “clear cut” matter and list it. We think those people are taking advantage of the system and vague legislation, Ms Kreet added. The result for a consumer may be seven years of difficulty in accessing credit.