Difference Between Equifax and Transunion

Managing financial health has become extremely crucial and difficult in today’s world; with the rise in fraudulent activities, the difficulty of the task increases. Moreover, besides banks, there are other credit monitoring and reporting agencies that keep an eye on the financial health of individuals and businesses, thereby helping them manage it. Equifax, Transunion, and Experian are the most popular and common credit reporting agencies.

Equifax vs Transunion

The main difference between Equifax and Transunion is that Equifax considers the credit history for about 81 months but, Transunion takes into account the credit history for about 7 years. While the Equifax score generally falls in the range of 280-850, the Transunion score falls in the range of 300-900.

Equifax vs Transunion

Equifax, in simple terms, refers to an American multinational agency that handles the reports of credits of consumers. It monitors the credit scores of individuals and businesses. The credit score of an individual or a company, as calculated by Equifax, is done on the basis of some key factors. These key factors include repayment history, credit utilization ratio, utilization of the type of credit, and credit history length.

With the information of about 1 billion consumers at an individual level and 65,000 customers at a global business level, Transunion has come a long way as a consumer credit agency of American origin. Spreading over more than 30 countries, Transunion manages the credit score of individuals or businesses. As calculated by Transunion, the credit scores get most affected by two factors, namely, payment history and credit history.

Comparison Table Between Equifax and Transunion

Parameters Of ComparisonEquifaxTransunion
User BaseEquifax has a user base of 800 million individual customers, 80 million businesses and spreads across 15 countries.Transunion has a user base of 1 billion individual customers, 65000 businesses, and spreads across 30 countries.
Factors affecting credit scoresThe factors which affect the credit scores of an individual/business as calculated by Equifax are:Payment HistoryCredit Utilisation RatioAge of the CreditTotal AccountsThe factors which affect the credit scores of an individual/business as calculated by Transunion are:Repayment HistoryCUR (Credit Utilisation Ratio)Number of accounts, i.e., credit accountsAge of credit linesNumber of times credit inquiries have been made.
Methods of calculating scoresEquifax calculates the credit scores of an individual or a business on the basis of a credit history of 81 months, where every open account and closed account of the individual or the business are taken into account.Transunion calculates the credit scores of an individual or a business on the basis of a credit history of 7 years.
Features of Equifax’s credit reportsThe main features of credit reports of an individual or the company, as calculated by Equifax, are:Identification and contact details of the individual/business.Credit summaryRecent activityAccount detailsThe main features of credit reports of an individual or the company, as calculated by Transunion, are:Personal Information of the individual/business.Credit InformationEmployment HistoryPublic Records
Popular productsSome popular products by Equifax include:Basic Credit Information ReportEquifax Risk ScoreEnhanced Credit Information ReportEquifax AlertsEquifax Portfolio ReviewSome popular products by Transunion include:Account Monitoring & Advanced AnalyticsCustomer Credit ReportingDebt RecoveryFinLockerFraud Analytics

What is Equifax?

The number of credit reporting companies and agencies is springing up quickly. However, the three notable agencies continue to dominate their space in this field. After Experian, Transunion and Equifax follow up the list as the top three credit reporting companies with the highest user base. With the information of about 800 million consumers at an individual level, and 80 million customers, at a global business level, Equifax has come a long way since its founding in 1899.

Founded by Cator Woolford and Guy Woolford, Equifax operates globally in more than 15 countries. The credit reports of an individual or business put forward by Equifax are highly detailed. Every single account, irrespective of whether it’s closed or open, and every single transaction, is recorded. Equifax collects its information from creditors such as credit card and mortgage companies to keep the records updated with accurate information. To maintain transparency in reports from all sides, Equifax also keeps a record of the individual or the business’s public records, including bankruptcies and other such cases.

The customer credit database of Equifax has a large reach in terms of geographical coverage. Moreover, all information is updated regularly with the use of sophisticated technology involving matching logic. The credit score can give you an idea about your financial health and personal credit health.

What is Transunion?

Just like Equifax, Transunion is another credit reporting agency and the smallest among the top 3 notable agencies. Transunion also monitors the credit scores and reports of businesses and individuals. However, Transunion doesn’t have the feature to display the complete record of transactions and accounts by which one can know if the account will get closed on account of a low credit score. 

Nevertheless, Transunion has other helpful features wherein it includes employment data and the history of an individual in its credit reports. With the help of this feature, individuals have the freedom to change, correct and update their employment details. Besides credit reports, Transunion also has some other features such as credit monitoring, wherein it acts as a watchdog to an individual’s credit scores, thereby protecting it from all kinds of fraudulent activities. 

This credit-monitoring package comes at an affordable monthly package where even a victim who has fallen into the trap of fraudulent activities can recover from the financial damage. Founded in 1968 by Christopher Cartwright, Transunion offers other features such as advanced analytics, account monitoring, account prioritization, audience segmentation, customer engagement, customer credit reporting, customer acquisition, debt recovery, digital lending, fraud analytics, identity proofing, and others.

Main Differences Between Equifax and Transunion

  1. While Equifax has a coverage of around fifteen countries, which includes about eight hundred million individuals and eighty million business level customers, Transunion has a coverage of around thirty countries, including about one billion individuals and sixty-five thousand million business level customers.
  2. The credit scores released by Equifax depend on payment history, credit utilization ratio, age of the credit, total accounts and are independent of the number of times credit inquiries have been made. On the other hand, The credit scores released by Transunion depend on all the factors, including the number of times credit inquiries are made. 
  3. The credit scores calculated by Equifax are calculated according to a credit history of eighty-one months. However, the credit scores calculated by Transunion are calculated according to a credit history of seven years.
  4. The credit reports released by Equifax include identification & contact details, credit summary, recent activity, account details of the individual, which doesn’t include employment history. The credit reports released by Transunion include all the factors, including employment history.
  5. Equifax has some beneficial popular products such as basic credit information reports, Equifax risk score, etc. Whereas Transunion’s popular products include account monitoring & advanced analytics, customer credit reporting, fraud analytics, etc.

Conclusion

Both Equifax and Transunion have their own credit scores and reports. In fact, the reports of all three credit reporting agencies are accurate in their own spheres. A healthy Equifax credit score falls beyond 670. On the other hand, a healthy Transunion credit score falls beyond 661. Maintaining credit scores becomes necessary because a healthy credit score assures them that you will return the amount on time when lenders view your credit report. If your credit scores are higher, you are more likely to have better credit terms with your lender.

References

  1. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3103294
  2. https://www.emerald.com/insight/content/doi/10.1108/S0733-558X(2010)000030A008/full/html
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