SCHUFA, the leading German consumer credit bureau, issued a short statement in July, that it had dismissed its CEO: “Rainer Neumann has left the company with immediate effect. The reasons behind this decision are irreconcilable positions concerning the strategic direction of the international business of SCHUFA”. Rainer Neumann was hired in 2000 and was instrumental in positioning SCHUFA as one of the leading credit bureaus in Germany. Since the board decision was unanimous, including board members representing employees perhaps indicates that there was more to the story than meets the eye.
SCHUFA’s is a late-comer in trying to expand internationally. It linked up with the Iceland based credit bureau ‘Creditinfo Group’ in December of 2008. ‘Creditinfo Group’ had over-expanded rather quickly into small Balkan and Eastern European markets and looked for a strong partner with deep pockets. The cost of this expansion was reflected in a drop in earnings at SCHUFA prompting the board to pull in the rains on its international growth strategy.
SCHUFA has been haunted relentlessly by critics about its poor data quality prompting the newly appointed minister of consumer affairs to issue the warning to credit bureaus to get their house in order, or else …! Recently, a data protection commissioner called on banks to boycott SCHUFA. Regrettably it appeared that SCHUFA never really defended itself, perhaps due to the fact that its data originates from banks who are its main shareholders. The latest barrages of criticism may have been the proverbial straw which broke the camel’s back.
Recently SCHUFA got a welcome reprieve on data quality: The renowned German Research Foundation ‘Warentest’ concluded, after sampling the database of SCHUFA, that one percent of the data was incorrect and eight percent of the data was outdated. This refutes all previously circulated perceptions about SCHUFA’s data quality. BIIA partner PASSWORD commented: “perhaps SCHUFA’s problem lies in its poor quality of PR work rather than the quality of its data.”
Source: SCHUFA Press Releases, Press Commentaries and PASSWORD Germany