Director Searches Now And Then

In the very early days nobody ran director searches and there were no credit reports to help businesses track their own financial information or the information about their partners. Actually business as you know it today also appeared much later.

Paper cuffs

When people bought something on credit, the store clerk wrote the amount on a piece of paper that was then put into a cuff (a paper tube worn on the wrist). Eventually all of the information from these cuffs was collected and put together for other merchants to refer to before granting credit. But they only collected the bad information and there was no verification that it was correct. The only groups that could access the information were lenders and merchants, known as mutual protection societies and roundtables. This somehow resembled director searches of today and soon proved to be an inefficient way for businesses to protect themselves from bad debt.

First credit reporting agencies

The first credit reporting agencies were established in the 1830s. They were set up as a network of offices across the country and differed from mutual protection societies in that they allowed anyone to access the credit information for a price. When the typewriter and carbon paper were developed in the 1870s, the information accumulated has become more widely available, more accurate and covered a much larger geographical area. These new credit reporting agencies dealt with four major groups: their subscribers, individual customers and businesses about which they reported, their branch office correspondents and the general public. All of these groups had the opportunity to run company and director searches to check any financial information they required.

Credit reports today

The major information that makes up business credit reports today includes credit history of your business, report inquiries and dispute statements. The credit history section includes your bill-paying history with banks, retail stores, finance companies and others who have granted you credit. It also includes information about each account you have, how much credit it includes, what your monthly payment is, etc. The section of report inquiries includes all credit granters who have run company or director searches on you and any others who were authorised to view your report. Your credit report may also include any dispute statements you've made on the report.

Today’s credit reports differ a lot from those used in the early days. Your report can be viewed by people you have initiated business with and other businesses. But each of these groups must have a permissible reason to access your report. You can also request copies of your report from credit bureaus regularly so you can correct any inaccuracies.