Experian 2012 Annual Report Download - page 12

10 Experian Annual Report 2012 Business overview
At the core of Credit Services are the
comprehensive databases that Experian
builds and manages, that hold the credit
application and repayment histories of
millions of consumers and businesses.
Globally, Experian holds credit payment
data on more than 740 million consumers
and 70 million businesses, and historical
data on 650 million vehicles. In total,
Experian operates 19 consumer credit
bureaux and 14 business credit bureaux
around the world.
Consumer and business information
A credit bureau is a database that includes
information supplied by lenders, and certain
public records, such as liens, judgments and
bankruptcies, by other third parties.
Lenders and other subscribing members
provide us with credit application and
repayment data on consumers and
businesses.
Experian augments that data with
publicly available information. It is then
aggregated, cleansed and sorted to form a
credit report on a consumer or a business
which comprehensively shows how credit
obligations have been managed in the past.
Credit reports vary by country, but typically
include identification information, past and
present credit obligations, court judgments,
bankruptcy information, suspected fraudulent
applications, collections data, previous
addresses and, in the case of businesses, may
include company registration and ownership.
In developed credit markets, such as the US
and UK, a credit report includes information
on credit obligations, both positive and
negative. Positive data includes accounts
that have been paid on time, forming a
complete picture of indebtedness and
credit payment behaviour, while negative
information includes past-due payments,
collection accounts and public records
information such as bankruptcies. In less
mature credit markets, bureaux often
contain only negative data.
Consumer credit reports help lenders make
better informed and faster credit decisions
through access to detailed historical
information about how consumers have
managed their credit obligations.
Business credit reports are used by clients to
set the credit terms for new accounts and to
manage existing account relationships with
their customers and suppliers.
Experian continually freshens and augments
its bureau databases, adding new sources of
data to further enhance the depth and quality
of the credit reports.
To check the credit history of a consumer or
business and store information with a credit
bureau, a company must have a legitimate
need for accessing the data and usually
must notify the applicant of their intention
to contact a credit bureau. The laws of each
country vary in respect of the hosting of such
data and access to it.
Experian maintains a comprehensive
security programme to protect credit
bureau data through its entire lifecycle, from
collection, transformation and use, to storage
and then destruction.
Experian does not make lending decisions
or offer any comment or advice on particular
applications, but simply provides factual
information.
Clients then use that information, often in
conjunction with other information such as
that included in an application form or any
previous agreements with the applicant, to
help decide whether or not to lend.
Automotive information
Experian’s automotive business supplies
vehicle history reports in the US, the UK,
Ireland and Italy to help organisations and
consumers understand the risk associated
with used vehicles. Reports typically
include data on title, registration, history
and accidents, manufacturer recall and
repair records. The information is sold
to automotive dealers, auction houses,
automotive companies and direct-to-
consumer to help establish the market
value of a used vehicle, the accuracy of the
odometer reading and whether or not the
vehicle has changed owners, been damaged
in an accident, or been imported.
Clients
Clients principally include organisations
that are extending or offering credit.
Examples include financial services,
telecommunications, utilities, insurance
companies, hospitals and automotive
dealers.
Financial characteristics
Credit reports are sold on a transactional
basis, priced per report delivered. Pricing
is typically tiered, varying according to the
volume of reports delivered to the client.
Typically, revenue for Credit Services recurs
habitually.
Competitive environment
Experian is the primary provider of
consumer credit information to many
financial institutions in the US; the other
credit bureaux are Equifax and TransUnion.
In Brazil and the UK, Experian is the clear
market leader and has leading positions in
many other countries.
In business information, Experian is the
market-leading provider in Brazil, the UK
and a number of other markets. In the US,
Experian is second to Dun & Bradstreet,
which is the only global competitor in this
field.
Market influences
See page 12 for market influences on Credit
Services and Decision Analytics.
Our four global business lines
Credit Services
Contribution to Group revenue
47%
P12