Credit Savvy general manager Dirk Hofman sat down with Fintech Business on Friday to discuss his company’s free service, which aims to displace the paid models of Veda and Dun & Bradstreet.

Credit Savvy is also very much geared around the new Comprehensive Credit Reporting regime, which is likely to change the way credit scores are calculated, Mr Hofman said.

“In today’s regime they may see that you have five credit enquiries over the last five years. They don’t know if those accounts are closed, open, whether it has been approved in the first place,” he said.

“Getting more transparency is a good thing. We fully support transparency of that data, and we think it’s a good for consumers,” Mr Hofman said.

The company, which launched in March following a 12-month development, provides its members with free access to their credit score as well as a monthly update.

Credit Savvy is an attempt to replicate the success of Credit Karma in the US, which boasts 40 million members – around one in eight Americans.

The Australia start-up uses the global credit score database of Experian to provide members with their credit score.

Members are then referred to a relevant home loan, credit card and personal loan products. These referral arrangements along with on-site advertising comprise the bulk of Credit Savvy’s revenue.

Mr Hofman said the biggest challenge for his company is raising awareness about credit scores among Australian consumers.

“It’s hard work to get people interested. It’s also still new for the banks to understand what we could be as a channel and a distribution partner for them,” he said.

“But the average person on the street wouldn't have any idea what it is, how it's being used, what's being held by the bureaus or by the banks, and how the banks assess them for credit and how to effectively manage your score and your credit reputation,” Mr Hofman added.

As well as providing members with their credit score (and monthly updates) for free, Credit Savvy also publishes a range of articles on credit reporting in the hopes of better educating consumers.

Credit Savvy isn't just about helping people with a good credit score get a better interest rate on their loan or credit card, Mr Hofman – it also aims to deter those with a bad credit rating from making it worse.

“People need to think about whether you should apply for that credit given that your score might not be good enough. It's only going to get worse,” he said.

“Nobody wins. The bank has to decline a customer, wasting their time, incurring costs. And the consumer will be annoyed they got knocked back."

On the positive side, Credit Savvy has relationships with peer-to-peer lenders RateSetter and SocietyOne to offer members with high credit scores favourable interest rates on personal loans.

Above all, Mr Hofman was keen to stress Credit Savvy’s independence from CBA and the fintech firm’s direct owner Aussie Home Loans.

Credit Savvy directs its members to a wide range of products, and it is “very much removed from CBA”, he said.

“We can only do this if we do it our way and not following the bank’s processes, because they are far more cumbersome,” Mr Hofman said.