Equifax, Experian and TransUnion are the three major consumer credit reporting agencies that operate in the United States. All three companies are for-profit enterprises that function to earn revenue. The Fair Credit Reporting Act requires that the businesses abide by certain rules and restrictions as to how they manage personal and financial data of U.S. consumers. Thus, the agencies play an important role in compiling individual credit histories and disseminating that information.
Equifax, with world headquarters in Atlanta, Ga., trades on the New York Stock Exchange under the symbol EFX. According to the company's website, Equifax offers a wide range of products from fraud protection to prescreening mortgage applicants. Equifax's largest customers are financial institutions that lend money to consumers.
Experian, headquartered in Dublin, Ireland, trades on the London Stock Exchange under the symbol EXPN. Experian has what the company calls four principal lines of business. These include providing credit information on consumers to lenders and providing software to help businesses refine approaches to lending.
TransUnion claims 45,000 customers on five continents and provides credit histories on consumers to clients in several markets. According to TransUnion, the key markets in which the company conducts business include financial services, collections and healthcare, among others.
All three agencies compile and distribute information related to consumers' credit-related activity. Consumer credit reporting agencies gather data, assemble credit histories on individuals, assign credit scores based on the histories and sell the reports to others. Insurance underwriters, healthcare providers, rental property managers, employers, mortgage companies and banks are a few of the types of businesses that use the services of consumer credit reporting agencies. The histories and credit scores assigned by the reporting agencies can affect what the consumer pays in insurance premiums and interest rates or whether a consumer is approved for credit.
Free Annual Report
Under the provisions of the Fair Credit Reporting Act, each of the three major consumer credit reporting agencies must provide consumers with a free copy of their credit report on file at the consumer's request once per year. Free copies of your credit reports can be obtained through the Annual Credit Report website. It is possible to stagger when you receive the reports so that individual credit history can be checked every four months free of charge. For example, request one report in January from one agency, request one in May from the second agency, and request the third in September.
Federal regulations require the major consumer credit reporting agencies to place a fraud alert on a consumer's file if requested by the individual. This protection makes businesses aware that the consumer believes identity theft could have occurred. According to federal law, a consumer does not have to contact all three major agencies. When one is contacted, the company is required to notify the other two. In this role, the agencies function as a warning system.
When news anchors or financial pundits refer to credit rating agencies, most often the reference is to another big three -- Moody's, Standard and Poor's, and Fitch's. These three companies are the major players in rating the credit quality of businesses and governmental agencies in the United States and should not be confused with consumer credit reporting agencies.
- Equifax: Company Profile
- Experian: Company Profile
- FTC.gov: Fair Credit Reporting Act
- TransUnion: Company Structure
- U.S. Securities and Exchange Commission: Report on the Role and Function of Credit Rating Agencies
- MyFICO: Credit Scores Understanding All 3 Scores & Where They Come From
- Federal Reserve Bank of Cleveland: Your Credit Score Is a Ranking, Not a Score
- AnnualCreditReport: About Us