ACCC decides on Experion
(1 August 2011 – Australia) The Australian Competition and Consumer Commission (ACCC) will decide on Thursday on a move by banks to help fund a rival credit rating service by multinational giant Experion.
The ACCC will decide on whether the move by the big four banks, plus Citigroup and GE Captial is an attempt to create more competition or reinforce their market power.
The banks have agreed to invest a combined A$7.2 million into the venture to help fund a competitor to the dominant player in the local market, Veda Advantage.
The banks say Veda charges too much, so they welcome the move by Experion at a time when a new regime of so-called positive credit reporting will be introduced.
Positive credit reporting tells the credit suppliers that you have been paying your bills on time, as opposed to traditional credit reporting, which tells them you are behind on your bills.
Experion is a big global player with revenues last year of A$3.9 billion and a profit of A$693 million, with a market capitalisation of A$12 billion.
That raises the question of why it needs funding from the banks, which will take a 24 percent stake in the new company along with Citi and GE.
Veda has mounted a campaign against the move, arguing in part it will strengthen the power of the big six companies involved at the expense of smaller financial houses.
It has argued that because smaller groups have restricted access to credit data, it will destroy innovation in the market.
The banks have agreed to invest a combined A$7.2 million into the venture to help fund a competitor to the dominant player in the local market, Veda Advantage.
The banks say Veda charges too much, so they welcome the move by Experion at a time when a new regime of so-called positive credit reporting will be introduced.
Positive credit reporting tells the credit suppliers that you have been paying your bills on time, as opposed to traditional credit reporting, which tells them you are behind on your bills.
Experion is a big global player with revenues last year of A$3.9 billion and a profit of A$693 million, with a market capitalisation of A$12 billion.
That raises the question of why it needs funding from the banks, which will take a 24 percent stake in the new company along with Citi and GE.
Veda has mounted a campaign against the move, arguing in part it will strengthen the power of the big six companies involved at the expense of smaller financial houses.
It has argued that because smaller groups have restricted access to credit data, it will destroy innovation in the market.
Subscribe