Each year, financial literacy empowerment and economic education non-profit organization Operation HOPE hosts its Global Forums Annual Meeting. The purpose of these series of meetings is to help open up the discussion on how the positive effects of a free enterprise can be extended to everyone globally.
At this year’s Operation HOPE Global Forums Annual Meeting in Atlanta, the Director of the Consumer Financial Protection Bureau (CFPB), Richard Cordray, delivered remarks on the impact of accessibility to credit reporting on consumers’ everyday lives. He pointed out how the CFPB is intricately linked to Operation HOPE through “the hard and important mission of empowering the economically vulnerable among us.”
CFPB’s research shows that 45 million people in the U.S. lack the access to scoreable credit reports, which can make it tougher to achieve financial independence. Often those without access to more traditional credit routes look to “higher cost alternatives to bridge the gap,” according to Cordray, which further deepens the economic divide.
“Credit reports and credit scores form a key foundation of people’s financial options, but they are not very transparent and often are poorly understood. We do not control our own fates, since we cannot vote with our feet by choosing another credit reporting company. Instead, it is mostly a business-to-business ecosystem where people have had little power to insist on better practices or fair treatment. Because of how credit reports affect our lives, we all need this industry to operate at the highest levels of quality and performance,” said Cordray.
In 2012, CFPB became the first government agency to oversee all credit reporting companies in the United States in order to keep everything and everyone in check.
“Over the last five years, we have been scrutinizing the credit reporting companies to make sure they are obeying the law and to assess whether their practices pose risks to consumers. We have learned a great deal, but, most importantly, we are working to correct the many problems we have found and to resolve matters that harmed consumers. We monitor and examine them the same ways we monitor and examine the biggest banks. This is a much more systematic approach than they have ever experienced before,” said Cordray.
Since its inception, CFPB has made the push for companies to improve quality control systems, to provide an easier route for consumer credit report error disputes and to deliver pristine information to credit reporting companies. CFPB has also started the Open Credit Score initiative to help people have a more direct hand in their credit scores. Today, U.S. citizens in the tens of millions have received free access to their credit scores through this program offering.