Here’s Why The Web’s First ‘Credit Badge’ Seems Like A Stupid Idea

Wayne's World

An email with the subject line, “How many personal finance bloggers can actually walk the walk?” appeared in my inbox yesterday.

Credit Sesame Announces The Web’s First Credit Badge Program,” said the press release, “free badges authenticate identities and certify good financial standing, enhance personal brands, and encourage trusted online interactions …”

The personal branding bit jarred me–since when does spotless credit make me Julia Allison?–but I was more baffled by the sheer idiocy of sharing such personal information with the world, deeming it bragging rights worthy of a Facebook or profile. Who would do such a horrible thing?

“Probably the same people who have a bumper-sticker on their car raving how their kid is an honour roll student,” says Luke Landes, a credit expert who blogs at Consumerism Commentary.

But while most people aren’t looking to discuss their credit standing on a first date, similarly they aren’t out to flood their inbox with shady marketing promotions and solicitations.

“It’s definitely a marketing ploy,” Landes says. “They’ll get people to sign up for the service so they’ll get personal information from average consumers, and partners can send advertisements. Sesame users will verify their credit information, and the website can present them with offers that Sesame could be compensated for, if not now then in the future.”

Knowing your credit score is a good thing, but putting such information out for all the world to see means there is no telling who you will attract, or what the consequences of doing so with Credit Sesame might be, even if the company has noble intentions. Consumers have already seen the fallout when supposedly “good” companies had their customers’ information breached by hackers, and flaunting your credit, along with Credit Sesame’s logo, might make you a prime target for identity theft.

On a cynical note, you would also be an unpaid advertiser for a company you barely know. Until you read the fine print, says Landes, you do not know what the tradeoff will be, or how the company makes its money, perhaps by selling your social security number or address to third parties.

“The idea came to us when we saw how people are sharing their stuff, their experience, and what they read,” Credit Sesame founder and CEO Adrian Nazari explained over the phone.”People were even sharing their lunch.”

But your credit score isn’t a Cosi salad, and with this in mind, Landes warns consumers against buying in.

“By having a badge [Credit Sesame] is creating an impression that isn’t necessarily true–that they’re a trustworthy company like the Better Business Bureau,” he said.

Consumers shouldn’t trust Credit Sesame off the bat, and realise that buying the “badge” won’t boost their credibility because, much like a Better Business Bureau or VeriSign logo, any business, or creditholder in this instance, can pay to have one. Even the notion of the badge itself, which offers Good, Excellent, and Verified ratings for not-so-responsible cardholders, is akin to buying Lori Gottlieb’s kid a trophy for winning fifth place

Until the badges are widely adopted across the board, says Justine Rivero, Communications Manager at, my landlord, employer, mortgage lender, and future ex-husband won’t be checking for it, rendering the badge more pointless. 

“Consumers don’t want to share their credit rating with anonymity,” says Kenneth Lin,’s CEO. “No one wants to show that they don’t pay their bills. Conversely, if you are showing your high score, you are bragging. In our experience, consumers don’t want their finances to go social.”

Judging from all the above you shouldn’t either, but if you are considering a credit badge or signing up for any “social service,” make sure you ask these questions first:

  • What will this cost? In the case of Credit Sesame, there’s no fee to sign up, which should send a signal that if you aren’t paying money to use the service, then you will be “paying” with something else you’re providing, i.e., your personal data.  
  • Are the terms subject to change? If they are and your data are at risk, you’ll definitely want to know about it.
  • What is the benefit to the company if I sign up? Ask the company they’re making their money, and be sure to read the terms and conditions to see if they’re sending your info to third parties.