CONNECT Act

The CONNECT Act, specifically the Credit Access and Inclusion Act of 2025, amends the Fair Credit Reporting Act to permit the reporting of positive consumer credit information from lease agreements (rent) and utility/telecommunications contracts to consumer reporting agencies. This is happening now as the bill has been introduced and referred to the Committee on Banking, Housing, and Urban Affairs. This change expands the data available for credit scoring, potentially increasing the number of consumers with scorable credit profiles and improving existing scores for those who consistently pay rent and utilities on time. The money trail flows directly to credit reporting agencies and companies that provide credit scoring services. These entities will gain access to a new, vast dataset of payment history, which they can integrate into their existing products and sell to lenders. The mechanism is regulatory relief, allowing data sharing that was previously restricted or ambiguous. Companies like FICO ($FICO), which develops credit scoring models, will see an expanded dataset to refine their algorithms, potentially leading to more accurate and inclusive scores. Experian ($EFX), TransUnion (not publicly traded in the US), and Equifax ($EFX) are the primary beneficiaries as they are the major consumer reporting agencies that collect and process this data. Financial technology companies that partner with these bureaus or offer alternative credit scoring solutions, such as CRIF (not publicly traded), also stand to gain from the increased data availability. Historically, similar legislative efforts to expand credit reporting have shown positive impacts on credit bureaus. For example, the expansion of alternative data sources for credit scoring has been a long-term trend. While not a direct legislative comparison, the growth of subprime lending markets in the early 2000s, which relied on expanded data sets, demonstrated the market's appetite for broader credit information. The Dodd-Frank Act of 2010, while primarily regulatory, also influenced the types of data used in credit decisions. The market for credit reporting and scoring services has consistently grown with increased data availability and demand from lenders. Specific winners include Fair Isaac Corporation ($FICO) due to increased demand for their scoring models, and Equifax ($EFX) as a major credit reporting agency. Fidelity National Information Services ($FIS) and Total System Services, through their payment processing and financial services, could also benefit from an expanded pool of creditworthy consumers. Losers are not directly identified by this bill; rather, it creates new opportunities for existing players by expanding the data landscape. The timeline for this bill involves committee review and potential votes in the Senate and House. If passed, implementation would follow, likely within 12-24 months, as credit bureaus integrate the new data streams. This bill is sponsored by Senator Tim Scott (R-SC), a senior member of the Senate Banking Committee, which indicates significant legislative momentum. The referral to the Committee on Banking, Housing, and Urban Affairs is appropriate given the bill's focus on financial services and credit reporting.