The Birth of Modern Credit Intelligence

Abstract

The history of external credit-intelligence players, with many accused of spying. (1)Pre-revolution—collaborative efforts of close-knit communities or business groups. (2)United Kingdom—guardian/trade protection societies, established as member co-operatives. (3)United States—for-profit ‘mercantile agencies, most founded by wholesalers capitalizing on their credit dossiers. Consumer credit bureaux developed separately, as did ‘credit men’ employed by companies. (4)The Big Three credit bureaux—Equifax, Experian and TransUnion, but also Centrale Rischi Finanziari (CRIF) and CreditInfo. Further details are provided regarding their geographic representation, and economic factors. (5)Rating agencies—Moody’s, Standard and Poors (S&P) and Fitch Ratings, which focus on wholesale credit, but some services overlap with small and medium enterprise (SME) credit. (6)High-level observations—i) segments served (consumer, micro, small- and medium-sized enterprises (MSME) and wholesale); ii) economies of scale—drove establishment, expansions, and mergers and acquisitions (M&A) activity; iii) communications—especially print publishing; iv) geographical spread—limitations; v) product mix—banks with deep data and experience are less reliant on external data.