Comment by registeredcorn
3 years ago
What exactly do employers and banks stand to gain from sharing this information? Is it an exchange of information for money?
3 years ago
What exactly do employers and banks stand to gain from sharing this information? Is it an exchange of information for money?
For employers it offloads employment and salary verification. Instead of having to pay someone to answer verification calls all day they just upload the data to The Work Number and let them handle it.
Are employers obligated to provide employment and salary verification?
If they didn't their employees would be pretty pissed when they're unable to get a mortgage.
3 replies →
Banks and organizations that are considering lending you credit (i.e. buying a house / car / getting a credit card) can know if you're getting in over your head with finances and might be higher risk to repay. They can set their interest rates and fees appropriately.
Although all that said for any major loan the bank is going to ask you to provide detailed proof of all income, assets, etc. They likely use this service as a check to make sure you aren't trying to overstate your income.
From what I recall at my time there, banks use it as supplemental source of creditworthiness validation. The government also pays for the data to verify eligibility for welfare and other social services. Employers...I don't think were a major revenue source although I wouldn't be surprised if some used it to inform their salary thresholds.