New research has found our young millennial generation have a poor awareness of financial credit but are willing to make life changes if educated about it.
Millennials number over 5.5 million people in Australia – that’s nearly a quarter of our population.
The report was commissioned by the Customer Owned Banking Association (COBA) and aims to reveal what millennials know about credit and their attitudes towards it.
Good Shepherd Microfinance undertook the report called Take Charge: Credit Reporting and Millennials and COBA CEO Mark Degotardi spoke to Broker News about it.
“The report reveals some valuable insights and attitudes from younger Australians to their credit history and on managing expenses,” he said.
“Research indicates that for younger Australians comprehensive credit reporting wasn’t a burning issue but once they learnt more, they saw the benefits of this system and in many cases resolved to make positive changes.”
Australia now employs a CCR system after being a negative reporting only system in the past, allowing lenders to report more information about borrowers.
The research showed over 60 per cent of the 18-34 year-olds surveyed didn’t understand what the term ‘credit report’ referred to, let alone the fact they had changed to a CCR system.
On a positive note, 72 per cent of the respondents liked the idea of being rewarded with better deals if they returned a positive credit score and more than half worried about missing out on a good deal because of a bad credit score.
On top of this, more than half were interested to learn more about CCR and wanted to know what their credit score was.
“With a focus on the customer and community, we believe customer owned banking is well placed to partner with millennials in large numbers and help them meet their changing needs in the future, including home ownership,” Mr Degotardi told Broker News.