Katie Britt and colleagues introduce bill to allow consumers improve their credit ratings
U.S. Senator Katie Britt joined Sen. Tim Scott (R-South Carolina) in introducing the Credit Access and Inclusion Act to responsibly expand credit access for millions of Americans with limited or non-existent credit histories. The sponsors said that this bipartisan legislation would permit property owners and utility and telecom providers to report payment data to credit reporting agencies, allowing consumers with an established track record of paying their bills on time the additional opportunity to develop a positive credit history. “Hardworking Alabamians and Americans who have demonstrated financial responsibility deserve a pathway to establish and build their credit,” said Sen. Britt. “This bill takes into consideration the varying circumstances and experiences of individuals who hope to achieve their American Dream. Credit reporting is a crucial component in our nation’s economy to establish financial stability for the individual and the lender – this legislation simply incorporates a complete history of on-time payments, like rent and utilities, to reflect an accurate credit score.” “If you pay your bills on time, your credit score should reflect it,” stated Scott. “Americans shouldn’t be held back from purchasing a home, financing their education, or pursuing their dreams simply because their on-time payments don’t happen to count towards their credit scores. This bill will remove needless barriers and help hardworking Americans gain access to credit.” Sens. Britt and Ranking Member Scott in cosponsoring the bill are Senators Joe Manchin (D- West Virginia), Tom Cotton (R-Arkansas), Angus King (I-Maine), Mike Rounds (R-South Dakota), and Cynthia Lummis (R-Wyoming). U.S. Congressman French Hill (R-Arkansas) introduced the bill in the U.S. House of Representatives last week, along with Reps. Tom Emmer (R-Minnesota), David Schweikert (R-Arizona), Michelle Steel (R-California), Young Kim (R-California), Maria Elvira Salazar (R-Florida), and Byron Donalds (R-Florida). According to information provided by Sens. Britt and Scott, approximately 26 million Americans are “credit invisible,” meaning they lack credit records or a history of traditional payments, such as student loans, car loans, or mortgage payments. Having no credit or thin credit makes economic mobility difficult and hampers an individual’s ability to purchase a home, take out student loans, buy a car, or even get a job. The Credit Access and Inclusion Act allows credit bureaus to collect payment data for services not traditionally factored into credit reporting, such as rent, internet, phone, electricity, and utility payments. Factoring these payments into credit reporting would expand credit histories and generate credit scores for consumers who were previously “unscorable.” Many Americans who don’t have credit cards, mortgages, car payments, etc., don’t have enough open accounts to generate a credit score. Some people, however, are just starting out in life, while some people with no credit accounts may have significant actual wealth. Katie Britt is a member of the Senate Committee on Banking, Housing, and Urban Affairs. To connect with the author of this story or to comment, email brandonmreporter@gmail.com.
