The three major credit bureaus, Experian, TransUnion, and Equifax, have all terminated their data partnerships with TomoCredit, a San Francisco startup, refusing to include credit lines reported by the company. TomoCredit claimed to help consumers boost their credit scores by offering lines of credit and reporting rent and utility payments to the credit bureaus. However, consumers have complained about difficulty canceling subscriptions with TomoCredit, and have reported that Tomo’s credit lines do not appear in their credit histories. The bureaus have now confirmed that they are not accepting information from TomoCredit, despite the company’s claims on its website.
TomoCredit founder and CEO Kristy Kim dismissed reports of the bureaus ending their partnerships with the company as inaccurate, but did not provide further explanation or agree to an interview. The startup, founded five years ago, was last valued at $222 million and has raised about $40 million in equity funding. However, Experian, TransUnion, and Equifax have all removed TomoCredit from their systems, indicating a major setback for the company in its efforts to help consumers build credit history. TomoCredit still displays logos from all three bureaus on its website, but Equifax has requested that its logo be removed.
Data shared exclusively with Forbes reveals that the three credit bureaus have virtually no records of any lines of credit from TomoCredit starting in August 2024. This is a significant change from earlier in the year when thousands of Tomo credit lines were appearing in consumer credit records. Consumers have reported that even when they were subscribers to TomoCredit, their credit lines were not reflected in their credit histories. Financial services attorneys suggest that high rates of disputes or failures to respond to disputes could be reasons for the bureaus to terminate partnerships with data providers.
The Consumer Financial Protection Bureau (CFPB) has highlighted deficiencies in data furnishers’ compliance with the Fair Credit Reporting Act, which may have put pressure on credit bureaus to scrutinize data providers like TomoCredit. The CFPB cited cases where furnishers failed to respond to disputes or responded in the same manner to all disputes. This could indicate potential issues with the accuracy of data being reported to the bureaus. While the exact reasons for the termination of partnerships between the bureaus and TomoCredit remain unclear, the move underscores the importance of accurate credit reporting for consumers seeking access to credit products like loans and credit cards.
Consumers like Jasmine Burch and Felisa Ware have reported discrepancies in their credit histories related to TomoCredit, with credit lines appearing in their reports only briefly or not at all. This raises concerns about the effectiveness of TomoCredit’s services in helping consumers build credit. It remains to be seen how TomoCredit will address the lack of support from the major credit bureaus and whether the company will be able to overcome this setback. The credit bureaus, for their part, maintain that they are committed to ensuring the accuracy of information included in credit reports and regularly review data furnishers for compliance with their data standards.
