The Financial Conduct Authority has unveiled plans to tighten information-sharing rules among lenders in a move designed to close gaps in consumers’ credit files and improve access to affordable borrowing.
The regulator announced it is consulting on proposals that would require lenders to share borrowers’ credit data with all designated consumer credit reference agencies (CRAs) if they choose to report to one, said ShareCast.
At present, some lenders provide information to only a single CRA, potentially leaving gaps in a borrower’s credit history depending on which agency a prospective lender consults.
CRAs play a critical role in the UK lending ecosystem. They collect and maintain financial data on individuals, including their history of credit repayments and outstanding debts, which banks and other providers use to assess affordability and creditworthiness. However, when that information is incomplete, the FCA argues it can distort lending decisions.
According to the regulator, patchy data can create obstacles for consumers seeking loans, particularly if positive repayment histories are not fully reflected across agencies. Conversely, limited visibility of existing borrowing could increase the risk of unaffordable lending, as well as errors or potential fraud.
By mandating broader data sharing, the FCA believes credit files will “more accurately reflect people’s financial circumstances”, helping both firms and borrowers. For consumers, fuller records could improve access to competitively priced credit products and reduce the likelihood of being unfairly declined. For firms, richer datasets may strengthen risk assessments and support more responsible lending decisions.
The consultation forms part of the FCA’s wider efforts to enhance data quality and transparency in consumer finance, as regulators place growing emphasis on fair treatment and affordability assessments in the wake of rising living costs and evolving credit markets.
Financial Conduct Authority director of consumer finance Alison Walters highlighted the importance of accurate data in supporting sound financial decisions.
“Access to affordable credit relies on good quality data – it’s vital in helping consumers navigate their financial lives. That’s why we want to make sure everyone’s credit information is as full and accurate as possible,” said FCA director of consumer finance Alison Walters.
The regulator is now seeking feedback from industry stakeholders and consumer groups on the proposed changes, which could reshape how credit information is shared across the UK’s lending landscape.
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