Who’s Got Your Credit Data? The Big 3 Credit Reporting Agencies

Sure, credit reporting agencies know a lot about you, but how much do they really know about you? It’s a good idea to understand who these companies are, how they handle your personal information, and how to work with them.

“Credit reports play an increasingly important role in Americans’ lives,” says the Consumer Financial Protection Bureau (CFPB). 1 By tracking your financial history, credit reporting agencies provide the basis for your credit score, which determines whether you can get a mortgage, car loan, credit card, student loan, apartment lease or… insurance policy, or even a job, the CFPB says. 2 For more information, read “What is a Credit Report and Why Is It Important?”

In the United States, most people think of the “big three” credit reporting agencies—Equifax, Experian, and TransUnion—although there are many other smaller agencies.

Credit reporting agencies (sometimes called credit bureaus) collect data from multiple sources to assess your creditworthiness—basically, whether you tend to pay back the debts you owe . 2,6 They combine this data into credit reports and then sell them to companies that want to do business with them.

The types of information that credit reporting agencies collect include: 7

• Personally Identifiable Information: Name, address, Social Security number, and date of birth.
• Credit accounts: type of credit, the amount of credit offered to you, the amount of credit you use, your payment history, applications for new credit accounts, and length of credit history.
• Public Records and Collections: Any tax evasion, bankruptcy, foreclosure, repossession, and debt collection actions.
• Alternative data: Cell phone bills, rent, and utility bills.
• Non-credit information: current and former employers, wages.

In a sense, your information has come full circle. Banks and other companies provide your credit and other personal information to credit reporting agencies.7 These agencies combine this information with data from other sources, such as credit card companies, debt collection agencies, and public records.7 Many of the same companies (so-called “data providers”) then buy back more comprehensive credit reports from these agencies.8

Of course, like everything human, this process is not perfect…

Because errors, identity theft, and other problems can occur at every step of the process, the agencies and companies that provide the information are subject to standards and regulatory oversight at the state and national levels .

Yet, between October 2021 and September 2022 , nearly 1 million complaints were filed with the CFPB regarding credit reporting. 9 The errors cited by the CFPB included misidentification, incorrect account status, data management errors, and incorrect balances . 10 For example, one of the Big Three suffered a major data breach in 2017 that affected millions of people . 11

To address these and other issues, lawmakers and regulators have worked in recent years to update and enforce standards. 12 At the same time , Congress has introduced legislation to further improve the transparency, accuracy, and security of credit reporting agencies . 13

The three major credit reporting agencies do essentially the same thing. Historically, the three agencies differentiated themselves by region. As the century-old credit reporting industry consolidated, Equifax rose to prominence in the South and East, Experian in the West, and TransUnion in the middle of the country . While those traditions remain, all three agencies are now national—and even operate overseas.

In addition to providing credit reports to lenders and other companies, credit reporting agencies make money by selling credit monitoring services, identity theft protection, and fraud protection to individuals, as well as copies of their credit reports (although by law, they are allowed to get one free copy each year) . 15,16 Agencies also sell personal information to companies that may make offers to you . 17,18 Another source of revenue is from aggregating information about you through data analytics . 15

Despite the similarities, what stands out to many people is the discrepancy between how various agencies score the same person—even when using a standardized scoring model, such as FICO. The Experian blog explains that the differences in scores are due to differences in how agencies obtain, tabulate, and calculate information . 19 For example, not all credit agencies publish data from the same company . 19 Not all updates may be made at the same time . 19 Each agency customizes its own computer model . 19 For a more in-depth look at credit scores, read “What is a Credit Score and How Is It Defined?”