Citi rewards high Veda scores with low interest rates 05 December 2014 5:21PM Bernard Kellerman Comprehensive credit reporting laws in Australia are starting to have a visible impact on consumer banking customers, with an announcement by Citi that it will offer discounted personal loan or credit cards to new customers whose credit risk is assessed by Veda as "excellent".Pricing based on credit worthiness is commonplace in mature credit markets such as the US and UK, where consumers actively use credit scores to seek out better deals."We are starting to see the first steps towards this in Australia," said David Scognamiglio, Veda's general manager of direct to consumer business. "In New Zealand, where Veda is the leading consumer credit bureau, we expect to see similar developments," a Veda spokesperson added.Citi Australia's head of cards and consumer lending, Alan Machet, said Citi was offering better deals than its published rates for customers in the higher two of the five VedaScore risk bands (which range from "excellent" down to "below average"). Citi's offers include a flexible personal loan that is two per cent below its "standard public offer" rate, to be made available to clients in the "Excellent" VedaScore band. There are greatly reduced, or even zero, annual fees for credit cards on offer as well.While Citi wouldn't be drawn on specific examples in its other regions, a spokesperson said, "as an example, Citi's cards business in the US does price for risk." He added that there were no plans for anyone with a "below average" score to be hit with an above average rate if they wanted a Citi card."No, we don't have any plans for this - this offer is about rewarding consumers who are in a higher VedaScore band with a better offer than our published rates," he said.The offer is open until 28 February, 2015 and "has no effect on interest rates or fees for existing Citi customer accounts," the bank noted in its promotional commentary.More offers based on retail banking customers running their own creditworthiness checks are likely to emerge in 2015, as Veda confirmed it is in discussions with a number of financial institutions.