Promoting economic growth by facilitating access to business information


Before granting credit facilities, lenders (including businesses offering goods on trade credit terms, banks and loan organisations) want to be confident that the businesses they offer a facility to will repay the money they lend. To assist them in this decision making, these organisations may look at the information held by companies called Commercial Credit Reference Agencies (CRA's). These agencies hold information on businesses that operate within the UK. This information is usually referred to as Commercial Credit Information and is often contained within a Business or Credit Report.

CRA's gather data on businesses from various different sources to create a Commercial Credit Information database This information is access by customers most commonly 0n-line in a Business or Credit Report.

The CRA's database is derived from publicly available sources including Companies House for Limited and Public Company Accounts, Annual Returns and Directors Information; Registry Trust for High Court Actions and County Court Judgments and the London, Edinburgh and Belfast Gazettes for Insolvency Proceedings and Bankruptcy Information. BIPA is committed to protecting the availability of these public sources as the data is crucial in the identification of businesses and enables CRA's to provide more accurate Commercial Credit Information.

In addition, CRA's may also gather information from other proprietary sources to supplement the publicly available data already gathered. This may include trade payment data information and business directory information.

CRA's often collate and analyse this information and provide customers with a easy to use summary Credit Rating or Credit Score. This can represent the creditworthiness, risk of failure or risk of payment default of an individual business. These are created using proprietary statistical risk assessment models.

No. CRA's use Companies House to obtain the names and address of all Companies in the UK (All Incorporated Businesses who are Private or Public Limited entities) and use this as an index to hold other types of information upon. However there is no publicly available source for non-incorporated business (sole-proprietorships and partnerships) name and addresses in the UK.

As a result, CRA's create their own Credit Information on these businesses often via business directories. CRA's cannot confess to having Credit Information on all UK Businesses as the full UK business population is truly unknown. BIPA are concerned that the lack of transparency in this area with no full public business index maybe hampering the identification of businesses for commercial decision making purposes.

Credit Reference Agencies are independent of each other and all use different proprietary data with different methodologies and models of assessing risk to create Credit Ratings or Credit Scores. This can of course sometimes provide different outputs.

Anybody can purchase CRA information – our Customers include large and small businesses; major banks; public sector bodies; credit insurers, etc.

Anybody can purchase Commercial Credit information – CRA customers include large and small businesses; major banks; public sector bodies; credit insurers, etc. In general, it would be parties that want to gather information on businesses in order to make business decisions.

Whether via the granting of a credit facility between businesses for the purchase of goods or the granting of a loan or credit insurance, it is typical practise for the lending party to obtain an independent assessment of the business they wish to make a decision on. This would usually involve obtaining a Commercial Credit Report from a CRA. This Credit Report will not only verify business details within a credit or loan application form but may also be used within the credit decision process. It is up to the lender to decide in conjunction with its own policy and perhaps their own information whether to grant a credit facility or not and if so, to what levels and to what terms.

The granting of credit between businesses is fundamental to the health of the economy. It has been estimated that credit between businesses is almost three times the size of total bank lending; perhaps as high as £500 billion annually in the UK. Credit Reference Agency information is used by all types of businesses to aid and facilitate their credit decisions.

Credit Reference Agencies are independent of each other and all use different data with different methodologies of assessing risk to create Credit Ratings or Credit Scores. This can of course sometimes provide different outputs.

Agencies who assign credit ratings for issuers of certain types of debt obligation as well as the debt instruments themselves. In some cases, the servicers of the underlying debt are also given ratings. In most cases the issuers of securities are companies, special purpose entities, local governments, non-profit organisations or national governments issuing debt like securities (i.e. bonds) that can be traded on a secondary market.

Credit Rating Agencies assign credit and risk indicators particularly to financial institutions, governments and debt instruments.

Primary Credit Rating Agencies include Standard & Poors, Moody's and Fitch

You should provide as much information on the performance of your business in a timely manner to relevant parties, for instance statutory information at Companies House. We recommend you file full accounts information even if you are not statutorily required to do so.

Pay your bills within agreed timescales.

Avoid incurring negative information such as County Court Judgments or Decrees.

If you have a query, or simply want to check the data being held, contact the relevant Credit Reference Agency.

BIPA's members include six principal Credit Reference Agencies in the UK If you need to contact another Agency please use their individual web-site or contact information as appropriate