Revisiting The CJEU's Ruling On CRA Scoring And Data Retention – Key Considerations For Market Participants

RegCORE – Client Alert | German Regulatory Developments

QuickTake

In the context of financial services in Germany, the Schutzgemeinschaft für allgemeine Kreditsicherung (SCHUFA) is one of the leading private credit reference agencies (CRAs) that collects individuals' credit histories and provides credit scores to lenders, other financial services providers as well as non-financial corporates as real economy users of CRA's credit information and scoring. SCHUFA uses a proprietary algorithm and probability-based scoring system to calculate its credit "score" based on certain characteristics of that person. The estimation of such scores is based on a set of assumptions and circumstances surrounding the individual in question, who accordingly then gets assigned to a group of persons with comparable characteristics, allowing similar behaviour to be predicted on a going forward basis. ¹