How Do Credit Bureaus Work in Canada?

Posted on March 14, 2024 by Mihir (Mike) Chande, CPA, CA, CIRP, Licensed Insolvency Trustee

If you have ever tried to get a credit card or a credit at a financial institution, you will have come across the terms “credit check” and “credit score.” So, if you have been wondering where this comes from, there is a third term, “credit bureaus.” 

Credit bureaus monitor your credit history and log files containing details on your credit. But how do they actually work? What makes them so important? This blog will look at all this and answer the question: How do credit bureaus work in Canada?

What is a Credit Bureau?

Let’s first look at what a credit bureau is in the first place. Credit bureaus, also known as credit reporting agencies, collect credit information from lenders and creditors, court houses and the Office of the Superintendent of Bankruptcy, putting it all together into a credit report. In Canada, we have two official credit bureaus, Equifax and TransUnion, founded in the United States. Equifax opened a Canadian branch in the early 1900s, while TransUnion Canada was opened in 1989.

Generally, most lenders and creditors report to credit bureaus, such as:

  • Financial institutions (such as banks and credit unions)
  • Credit card companies (retail and store cards)
  • Debt collection agencies
  • Many cell phone, cable and internet providers
  • Public records, such as bankruptcy and consumer proposal
  • Court-ordered judgments and registered items like a lien on a car

For many of us, rent is one of the most significant monthly payments, so you might wonder if landlords also report payments to credit bureaus. The answer is: It depends. Participation in this is voluntary, however, it costs a fee, so it is up to the individual landlord if they want to report to the credit bureau. British Columbia, Alberta, Saskatchewan, Manitoba and Ontario have the LCB (Landlord Credit Bureau) that collects rent payment information and passes it on to Equifax Canada for inclusion in your credit report. It will also register if late payments will result in collection activity.

Equifax is one of the credit bureaus in Canada

The Primary Credit Bureaus in Canada

As mentioned above, two official credit bureaus operate in Canada, Equifax Canada and TransUnion Canada. They are the only two official credit bureaus compiling credit reports.

You may have encountered other companies offering free credit reports, such as Borrowell, Credit Karma or ClearScore. However, they draw their information from Equifax and TransUnion, so you can acquire this data yourself from the two credit bureaus. While you can get a free report from Equifax through MyEquifax, TransUnion still charges for a credit report. All these companies mentioned above will offer a free credit report, but only after you provide them with a lot of personal information that they use to tailor debt services to you, such as credit cards or personal loans. Utilizing one of these services may seem very tempting to improve your credit record, but you may end up with more debt than before.

Credit Score & Report

A credit report records your repayment history on various credit facilities such as credit cards, loans and lines of credit. Utilities, cell phone providers or gym memberships typically do not report unless you are in arrears. As a result, so if your utilities go to collections or you have had 3 late payments, this will likely be reported on your credit report.

The credit score is shown on a scale from 300 to 900; the higher the score, the better your credit, but the report indicates far more than just a number.

Generally, it consists of four parts:

  • Personal information, such as your name, address, social insurance number and date of birth
  • Creditor trade lines. This includes accounts you have with lenders, including the name of the lender, the account type (credit card, line of credit, loan, mortgage), when the account was opened, the current balance, credit limit and payment history (showing late payments or payments made on time.)
  • Credit inquiries. This is an interesting point because this information can impact your credit score. There are two types of credit inquiry: soft and hard. Soft inquiries are simple credit checks by creditors or obtaining your own credit report. These have no impact on your credit. On the other hand, a hard inquiry is logged when you apply for a credit card or loan. A hard inquiry will negatively impact your credit score, so as you can imagine, the more hard inquiries you have, the more it will negatively impact your credit score and ability to borrow.
  • Public records and collections. If you have any accounts that went to collections or have filed a bankruptcy or consumer proposal, they will show up in this section. The same goes for court judgments and liens against your car.

Your credit report will not show income and bank account balances, assets or investments, so while the report will give a snapshot of your credit and repayment history, it does not provide a complete picture of your financial position.

Generally, you should get and review a copy of your credit report at least once a year. This will allow you to check for errors directly and dispute them with the credit bureaus. However, while filing a dispute is free, you must prove that the information is wrong.

Credit bureaus give ratings of your credit score.

How Are Credit Bureaus Regulated

Credit bureaus are provincially regulated and have several basic requirements they must follow. Two of these requirements are very relevant to the consumer:

  • Limiting access to your credit information only to those with a legitimate reason. Some specific reasons qualify for this, such as giving you credit, tenancy, insurance, employment, and debt collection. It is an offence for anyone to get your credit information from an agency for a reason that doesn’t involve a credit transaction with you.
  • Adverse action. You must be notified, for example, if a financial institution denies you a claim based on your credit information or if a charge is increased because of your credit history.


Equifax and TransUnion are the two credit bureaus monitoring your credit history. It is important to note that not all lenders and creditors report to both bureaus. Some only report to Equifax, some only to TransUnion and others to both. This means that your report can look different, depending on which bureau you get your credit report from. As a result, it is advisable to pull a credit report from both to ensure both are reporting accurate information.

Understanding the credit bureau system and credit reports is critical to understanding your finances. If you are struggling with debt and are trying to recover from this burden, the experienced Licensed Insolvency Trustees of Chande Debt Solutions are focused on personal insolvency services. We know that filing a consumer proposal or bankruptcy is a serious matter, and we want to ensure that you are well informed and don’t rush into just any solutions. All of our consultations are free, without time limits.

Call us today at 416-366-3328 or fill out our convenient online form to learn how we can help you recover financially.

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Mihir Chande
Mihir (Mike) Chande, CPA, CA, CIRP, Licensed Insolvency Trustee Mike, a Chartered Accountant, began his insolvency career in the Corporate Insolvency and Restructuring group at one of Canada’s largest insolvency firms. After gaining extensive experience, he founded Chande Debt Solutions to offer personalized and empathetic debt relief services to clients seeking an alternative to traditional solutions.

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