Things to watch out for

Beware credit repair companies

Credit repair companies often charge large upfront fees to investigate a consumer’s credit report , and many claim they can remove data from your report. You should be wary of any organisation that promises to do this.

If there are errors on your credit file, you don’t have to pay anyone to fix them. The consumer safeguards in the law require credit providers and credit reporting bodies to investigate and respond to consumers’ correction requests about inaccuracies in credit reports. They are not allowed to refer you to someone else. A credit provider or credit reporting body will pay any costs of investigating a correction request. If a dispute is referred to an external dispute resolution (EDR) scheme for investigation, you do not pay for the EDR investigation. However, information on your credit report that is correct can’t be removed. 

Some credit repair companies may also try to convince you to enter into insolvency arrangements, or to consolidate your debts with a high-interest loan. This may end up costing you more than if you had negotiated directly with your credit provider.

You should sort out any problems with your credit report by talking to your credit provider or credit reporting body. You can also ask a financial counsellor or community legal service for advice. And if you are unhappy with your credit provider or credit reporting body’s decision, you can take the problem to their EDR scheme. 

Unlicensed financial services providers

Banks, credit unions, mortgage brokers and other financial services credit providers that provide or are involved in arranging consumer credit, such as home loans, personal loans or credit cards, or consumer leases, must have an Australian credit licence. These licences are administered and enforced by the Australian Securities and Investments Commission (ASIC).

You can check if a financial services  credit provider  is licensed by searching ASIC’s Professional Registers, where you can find the Australian credit licence number of any licensed credit provider  . You can also phone ASIC’s Infoline on 1300 300 630.

Utilities (like electricity or gas companies) and telecommunications companies provide consumer credit. That is, they allow you to use their services and pay for them later. They do not need to hold an Australian credit licence to provide this kind of credit.