Already a subscriber?The competition regulator is probing Irish credit file giant Experian’s proposed $US532 million acquisition of illion, which competes with US-based Equifax supplying local banks with the data they use to evaluate borrowers.
Some of the data comes from public records, such as administrations and bankruptcies, while most is from lenders themselves, who share information to help the databases become as complete as possible. If approved, it would create a duopoly for consumer credit data with the two operators based outside Australia.In a market inquiries letter published last Friday, the ACCC said it would examine the transaction to determine if it would substantially lessen competition, the test in the competition legislation.
It has less than 5 per cent market share, according to sources, compared to Equifax , which has around 70 per cent, and illion over 25 per cent.. But Archer ended up pulling the auction and sold a minority stake to Macquarie Principal Finance.Big banks pay tens of millions of dollars a year for their credit data sets, which are fed into loan assessment algorithms to determine if customers can borrow pursuant to responsible lending laws.
In 2019, the business was pitched to potential buyers with expectations of $89 million in earnings before interest, taxes, depreciation and amortisation and $226 million revenue for the year to June 2020, according to Street Talk.