Did Credit Karma Just Fundamentally Change the Free Credit Score Industry?

Credit Karma recently announced it was now offering all its customers two free credit reports, an expansion from the one it had previously been offering. Most of those following Credit Karma and the free credit score and report industry looked at this move as nothing more than a convenient expansion of what the company had already been doing. What many have failed to see is this latest move may have fundamentally changed the free credit score and free credit report industry.

What is such a big deal about one company offering two credit reports instead of just one? Up until the announcement, all the major players in the industry were tied exclusively to one of the three credit bureaus. Credit Karma receives its free credit score and credit report information from Transunion. Credit Sesame receives its information exclusively from Experian. Quizzle received its information from Equifax. Credit.com aligns with Experian. Lending Tree gets its information from Transunion. Mint sources its information from Equifax. All the sites giving out free credit scores and free credit reports have, up to this point, only used a single credit reporting bureau.

That’s no longer the case. By offering a second credit report, Credit Karma instantly broke down the exclusive free score and report arrangement that has held between these sites and the credit bureaus for years. Doing so could be a much bigger deal than it first appears. The reason is the information each credit bureau keeps on each customer isn’t necessarily the same. If a consumer wanted to know a credit score or what was on a credit report more than once a year (everyone can receive a free credit report from each of the credit bureaus once a year at AnnualCreditReport), they had to sign up with multiple websites. One to find out their information from Transunion, another to find out their information from Experian, and yet another one to find out their information from Equifax. By becoming the first site to offer credit reports from multiple credit reporting agencies, Credit Karma has lined itself up to be the one-stop shop for this information.

Think about it. If you were a member of Credit Karma for your Transunion information and a member of Quizzle or Mint for your Equifax credit score and report information, with this new announcement, why would you need to keep your Mint or Quizzle account? You can now get both from Credit Karma, which gives consumers a reason to stay if a consumer ever decides he needs to choose between competing sites.