Banks take the lead on data sharing plans

Four banks announce initiative to pool information on credit behaviour

The UK financial services sector is to increase the sharing of data between organisations, with four banks announcing plans to provide more information about their credit card holders.

Barclaycard, Egg, the Co-Operative Bank and Abbey will make more data on customer behaviour available through the main credit reference agencies in the UK.

Most banks already share some information on their customers, but this scheme aims to help identify customers who are getting into financial difficulty, by making more detailed information available.

‘Delivering improved data sharing is an important step, and we look forward to working with others as they follow this lead,’ said Barclaycard chief executive Gary Hoffman.

The four banks will provide data on their customers’ credit limits, recent repayments and changes in credit limits.

Other banks, such as Nationwide and MBNA, have already expressed an interest in joining the initiative, although HSBC has raised concerns about customer privacy.

But Egg chief executive Paul Gratton says strict rules are in place regarding how data is used, particularly in terms of ensuring that shared data is not used to target customers for marketing.

‘The existing standards will continue to ensure that personal data is treated with the highest levels of privacy and security,’ said Gratton.

Trade body Apacs says it continues to promote data sharing in the credit card industry.

‘This initiative is being launched by a group of individual card companies and takes data sharing further than before,’ said an Apacs spokeswoman.

‘Apacs will be happy to facilitate a debate across the whole credit card industry to see if it is practical or appropriate to extend data sharing across the industry as a whole.’

A number of other data sharing initiatives are being put in place across the financial services community, including plans to create a secure online site for sharing fraud data (Computing, 17 November).