Explain Like I´m Five
A simple explanation of credit agencies
Barbara and her parents have moved to a new town, and Barbara has a place at a new kindergarten. On the first day, Barbara is unhappy. She doesn’t know anyone and is uncertain which children to play with. Luckily, on the second day, Barbara becomes friends with Marion. Marion gets on very well with all the other children. She not only knows which children like playing with which toys, but also which children to watch out for because they like pinching others! Thanks to that information, Barbara can decide which children she would like to play with and which ones she would rather avoid.
If Barbara were a company and wanted to enter new markets and do business with new companies, she could obtain information about potential partners from a credit agency. Armed with that information, Barbara Ltd. can decide whether a business transaction is too risky to enter into or not.
22 November 2017