When credit bureau Experian flubbed its first effort last week to offer consumers their credit reports online, the snafu quickly became a cautionary tale about the danger and immaturity of the Internet. But smaller companies that buy and resell credit information are pressing ahead to give consumers and businesses the same type of access to credit reports.
Resellers make their money by buying consumer credit information from the "Big Three" credit bureaus--Experian, Equifax, and Trans Union--and reselling it to anyone who can show a valid reason to check such sensitive information according to federal credit laws. The requester could be a prospective employer, a bank, or a consumer herself.
Until this summer, credit bureaus have been reluctant to provide reports over the Internet. Experian was the first and so far the only one of the Big Three to take a stab at it, and once traffic on its servers started to climb, they began misrouting requested reports so that person A got the report of person B, B got the report of C, and so forth.
Meanwhile, reseller QSpace of Oakland, California, provides nearly instant access from the company's Web site to Experian's database of consumer information, the same information that Experian was serving up to the wrong people last week before quickly pulling the plug.
QSpace isn't likely to have the same problems, however, because it uses its own delivery software to send data to the buyer's desktop, according to QSpace CEO I.O.A. Eze.
"Accessing the information is easy," Eze said. "The dynamic generation of Web pages in real time is more difficult."
To ensure proper verification of a person's identity, QSpace requires the use of a digital ID from VeriSign. If a consumer requesting her report online doesn't have a digital ID, the QSpace service will automatically contact VeriSign and sign her up. As soon as VeriSign's system grants the ID, QSpace gathers the credit report from Experian and sends it back to the requester. The entire process usually takes less than three minutes, according to Eze.
Another reseller who has sold over 13,000 reports online since November disagrees that digital IDs are the way to ensure privacy. Credit Chequers Information Services hasn't ventured into the consumer market, opting to provide reports only to businesses because their identities are easier to check.
"I don't feel that certificate authorities [such as VeriSign] are providing enough effort to verify the identity of the party they assign the ID to," said Credit Chequers president Jonathan Wolf. "I think business-to-business is much more secure because we're verifying in a traditional method the ID of the entity who's getting access to the system."
To protect the data in transmission, both Credit Chequers and QSpace rely upon the 128-bit encryption built into Microsoft and Netscape browsers. Users should be aware that the U.S. and Canadian versions of these browsers have much stronger encryption than the versions made for international users.
QSpace charges $8 per credit report. Unlike the Big Three bureaus, the reseller is not obliged to give free or reduced rates mandated by some states. There is an additional one-time fee for obtaining a digital ID. Credit Chequers only sells to businesses; prices per report range from $3 to $10 each, depending upon the volume of the request.