[pow_pp_-1_v]

> In the 60s/70s it was about knowing your bank manager, so he knew you'd be able to pay.

You do recognize how terribly inefficient that is, right? In this day and age its all about scale. Expecting a bank manger to have financial profile of all the clients using his firm is impractical.

For all it's faults, the credit reporting agencies are providing a service. It's not perfect and I think it's best they could do with the information available to them. I expect they will improve their score though once they start incorporating signals from social media and other sources.

[mattmanser]

In reality the new credit agency model's been tested once, and it failed.

[gaius]

You do recognize how terribly inefficient that is, right? In this day and age its all about scale.

Is it, tho'? It is well known that IT doesn't improve productivity[1]; all the benefits of automation get swallowed up in the extra people needed to support and maintain it. So we can assume that the ratio of bank employees to bank customers has remained constant over time. So actually there's no reason for bank's not to operate the old personal-relationship model; they would need to employ the same number of staff to do it, just locate them in branches rather than at head office.

[1] http://www.computerweekly.com/opinion/McKinsey-Why-IT-does-n...