A new study by credit reporting agency Veda has found that 13 per cent of Australians are at risk of defaulting on credit in the next 12 months, which can stop them from successfully applying for loans.
The study ranked the credit scores of a significant one million Australians from zero to 1200 – it found the national average to be 760 which is considered ‘very good’.
Despite this, the data found that two million Australians are at financial risk, and that financial strain and slack bill-paying were the biggest factors in people receiving bad credit scores.
Belinda Diprose from Veda told Brokernews that people should check their credit history and do what they can to improve their score before it was too late.
“It is important that people know they will be able to seek out a greater range of credit offers based on their credit worthiness, with some lenders already preparing to offer this opportunity based on VedaScores,” she said.
“The extra information will enable credit providers to assess risk levels more accurately, which we have seen benefit consumers overseas.”
“Consumers who know they have a poor VedaScore can gain insights to improve their credit rating and become more attractive to credit providers.”
Independent consumer advocate Christopher Zinn also spoke to Brokernews and said that people with poor credit ratings weren’t necessarily struggling financially, it was often just as much because of their history and ability to build up their repayment history to service debt.
