The Atlantic Monthly recently published an essay covering the history of credit bureaus. I thought of the number of times people have challenged my descriptions of bureaus and small business credit. “But everyone knows they are about consumer credit (emphasis theirs)!”
As this piece makes clear, the mercantile agency that would become Dun & Bradstreet was the granddaddy of all credit bureaus.
Follow the link above or here to read Sarah Jeong’s excellent coverage but here are some excerpts:
“They were enormously tech-savvy, and invasive in their methods–and they enlisted Abraham Lincoln into their ranks.”
“The present day reality might be a grotesque ziggurat of data sitting in the middle of Utah, but its spiritual ancestor is the 19th-century credit bureau.”
Or consider this, remembering that we are talking about the creditworthiness of a business (or merchant as they said back then):
“They sought information (often unreliably subjective) about a person’s credit-worthiness, judged not just in terms of his financial circumstances, but his personal character–Was he married? Did he have children? Who were his parents? What church did he attend?”
“‘The whole proceeding bears upon its face the most diabolical jesuitism that has ever cursed the world.’ wrote one merchant.”
The article notes that regulations have been enacted to provide a measure of transparency and accountability in consumer credit. It’s important to note, but not when the business owner’s consumer credit information is used for a business loan.
Still, it concludes:
“Whether it’s a 19th century credit bureau or a 21st century rent-to-own laptop store, in this country, the cutting edge of surveillance can be found wherever the debtors are.”
Follow the money so to speak.