Will Natwest and RBS banking issues affect my credit rating?

Dear James,

Can missed payments caused by the IT problems at NatWest, Royal Bank of Scotland and Ulster Bank affect your credit rating and, if so, what should customers do?

Rachel, London

Dear Rachel,

We have been receiving questions about this and there are really two elements to it. Firstly, many current accounts carry an overdraft facility and, because this is a credit agreement, information about how these agreements are managed is shared on a monthly basis with the credit reference agencies (CRAs). As a result, misdemeanours such as overdraft infringements, bounced cheques and refused direct debits would normally trigger adverse data to be registered with the CRAs. However, we have been in regular contact with the banks in question and they have assured us that they will take steps to make sure that any adverse data caused by these IT problems is not sent to the CRAs. Even if adverse data were inadvertently recorded, if it is spotted by the bank or by the customer (checking his or her own credit report) then the bank would be able to amend its own data and rectify the matter.  The second element is around payments due from customers’ current accounts to other credit providers.  Lenders usually exercise a degree of discretion before registering late payments on customers' credit reports. But if payments due out of some customers’ accounts – whether by cheque, standing order or direct debit – are delayed by, for example, a week or more, they could find late payments registered on their credit reports by other organisations.  We are currently talking to RBS, NatWest and Ulster Bank to see if there’s anything we can do to help. We also recommend that customers affected contact all of their creditors to make sure, if payments are still delayed, they are aware of the reasons and can then take this into consideration. At the same time, we encourage affected people to keep a close eye on their credit reports so that if late payments do crop up, they can very quickly raise the issue with the lender or lenders involved. It would ultimately be each individual lender’s decision over whether to remove a late payment from someone’s credit report caused by another company. If you found a late payment on your credit report, took it up with lender and they refused to remove it, you could of course add a statement to your report, called a notice of correction, to make sure anyone using the data in the future is fully aware of the circumstances. (September 2014)


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