Is Credit Karma Safe?

By: Clint Proctor

Credit Karma is a popular service that lets its members access their TransUnion and Equifax credit scores and reports completely free. 

In addition to giving free credit data, Credit Karma also educates its members on the factors that contribute to their score and gives tips for improvement. 

I’ve personally been a Credit Karma user for over five years and I can confidently say that its service works as advertised. But I also realize that in order for Credit Karma’s model to work, it needs access to some of my personal information. 

And with the prevalence of data breaches today, that can be concerning.

When any bank, institution, or financial service has access to my sensitive information, I want to know that they’re keeping it safe. And Credit Karma is no different. 

Is Credit Karma safe?

Credit Karma promises to go the “extra mile” to protect your data. And when you evaluate its security practices, that certainly appears to be the case. 

First, Credit Karma uses bank-level 128-bit encryption in all of its data transmissions. Second, it has a dedicated security team that monitors and responds to concerns immediately. Third, it submits to regular external security assessments and audits from third parties.

Finally, Credit Karma maintains a bug bounty program. The company will actually pay people to identify and notify it of vulnerabilities. This is a strategy that other top technology companies, like Apple and Google, have used for years and can be an effective way to stay a step ahead of hackers.

What information does Credit Karma collect?

In order for Credit Karma to work, it needs to match your identity with your TransUnion and Equifax credit files. To do that, you’ll need to give the site some personal information, including your name, address, and birth date.

You’ll also be asked to provide the last four digits of your social security number. Credit Karma says that for most people this will be enough to match your identity with your credit profiles. But in some cases, the site may need your full SSN.

Does Credit Karma share my personal information?

No. Credit Karma promises to never share or sell its members’ data to third parties without consent. 

There are times when it may share your information with other institutions, but only with your permission. Here’s how that would work.

Credit Karma makes money by recommending products and services to its members. For instance, it may recommend a specific rewards card that you’d have a good chance of qualifying for. If you decide to apply for the credit card, you’d be giving Credit Karma permission to share your credit information with the card issuer. 

It’s important to point out that even though Credit Karma may be able to pre-populate some of your data on a bank or lender’s application, you’ll still need to submit the application yourself. And once you’ve submitted your information to a third party, it will be up to them to protect it in accordance with their own privacy standards.

How Credit Karma can help to protect your identity

While Credit Karma security standards are high, that’s not the case for every organization that has access to your data. 

Credit Karma estimates that over 105 million Americans have a password that could be found on the dark web. And they say that Americans over 18 have nearly a 1 in 2 chance of one of their passwords being exposed on the dark web.

Thankfully, Credit Karma can help with this, too. In addition to providing free credit scores and reports to its members, it offers free credit monitoring as well. 

Credit Karma notifies members whenever a new hard inquiry shows up on their credit report. And it searches over 13 billion public and dark web breach records to see if your personal information was involved.

I’ve personally been notified twice from Credit Karma that some of my personal information was involved in a breach. And that helped me take the necessary steps to protect myself. 

The bottom line

No privacy measures are perfect and no online business can “guarantee” security. But Credit Karma users should be encouraged to know that the company works hard to protect members from both internal and external privacy threats.

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This post originally appeared on the American Express OPEN Forum, where Mashable regularly contributes articles about leveraging social media and technology in small business.