Credit Rating

HM Treasury written question – answered at on 1 August 2017.

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Photo of Lord Bird Lord Bird Crossbench

Her Majesty's Government what steps they are taking to explain and promote (1) the factors that are taken into account by firms carrying out credit-related regulated activities when assessing borrowers' creditworthiness, and (2) the steps that borrowers may take to increase their creditworthiness.

Photo of Lord Bates Lord Bates The Minister of State, Department for International Development

The government is committed to ensuring that consumers have the information they need to make financial decisions and have the confidence and skills they need to successfully engage with their finances.

Leadership in this area is provided both by government and by the Money Advice Service, which was set up by the Financial Services and Markets Act 2010 and was given statutory objectives to enhance the understanding and knowledge of members of the public of financial matters, including the use of credit.

The Money Advice Service website provides free-to-client impartial guidance on creditworthiness including what information is in a credit report and what steps members of the public can take to improve their creditworthiness.

The government has recently introduced legislation into Parliament to create a new financial guidance body. The new body will replace the Money Advice Service, The Pensions Advisory Service (TPAS) and Pension Wise and is designed to offer a simpler source of guidance, reducing duplication across the government’s guidance services. The new body will take forward the work of the Money Advice Service on enhancing public understanding of financial matters.

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