At a time when more information is being removed from consumers’ credit reports, a pair of bills have been introduced in Congress aimed at adding more tradelines to credit reports as a means of expanding credit access for individuals with limited or no credit histories.
A bill has been introduced in the Senate by Sen. Tim Scott [R-S.C.], the Ranking Member of the Senate Banking Committee, along with a companion bill introduced in the House of Representatives by Rep. French Hill [R-Ark.] that would amend the Fair Credit Reporting Act to permit property owners, utility companies, and telecom carriers to report payments made by consumers on their credit reports. The bills — called the Credit Access and Inclusion Act — are intended to help consumers who are making payments on those bills to develop positive credit histories.
“If you pay your bills on time, your credit score should reflect it,” said Ranking Member Scott, in a statement. “Americans shouldn’t be held back from purchasing a home, financing their education, or pursuing their dreams simply because their on-time payments don’t happen to count towards their credit scores. This bill will remove needless barriers and help hardworking Americans gain access to credit.”
Utility firms would be prohibited from reporting negative information to the credit reporting agencies if consumers have entered into a payment plan, even a deferred one, and as long as the consumer is meeting the terms of that plan.
There are about 26 million individuals in the United States that are “credit invisible,” meaning they don’t have enough of a credit history for the credit reporting agencies to give them a credit score. Lacking a credit score can keep individuals from being able to buy a home or car, take out student loans, or get a job or insurance.