The proposed shake-up of the country's credit system is long overdue and deserves serious consideration.
As reported this week, the scheme would result in people's last 200 bill payments becoming part of their credit history, showing their track record in paying bills and repaying debt.
It would cover electricity, gas or phone bills,
mortgage or credit-card invoices, insurance, or other monthly payments.
So far, it has broad support, including from Tauranga Budget Advisory Service.
The new system, proposed by the Privacy Commissioner, would need a number of companies and organisations to sign up for it to work properly - but if they do, it has the ability to transform the way our credit system works.
There is a major problem in this country of people borrowing too much and living beyond their means. It means they default on repayments and get into arrears and sometimes the downstream consequences such as impact on families, gambling and crime can be horrendous.
Companies can also be caught out. How often have they been left in the lurch by someone who has a bad record in managing their money but this has not shown up during a standard credit check?
It is a two-way street though.
Budget advisers are also frustrated by irresponsible creditors handing out money without doing the right checks - resulting in people's debts rising out of control.
There is another advantage to the scheme in that people who do find themselves in trouble are also able to demonstrate, over a period of time, they have changed their ways and deserve another chance.
There are privacy concerns. Even the Privacy Commissioner admits the plan is intrusive.
There will always be people who despite their best intentions find their finances blowing out of control. It will be even more important they seek help early if this proposal comes into force.
One sign of reassurance is from the banking industry. The Bankers Association says missing a single phone bill payment is unlikely to affect whether a person could get a loan, especially if they had records of long-term regular repayments.
The only people who should fear this scheme are those who are terrible at paying their bills on time or who are living beyond their means, and therefore not taking responsibility.
It should force many of them to change their ways.
