If Greece defaults the problems could well spread to Portugal, Italy, Spain and the Republic of Ireland - where the UK has a much larger investment. So without a doubt, an unmanaged Greek default could have crippling consequences for the UK economy. In addition, the Eurozone is one of the UK's biggest trading partners, so there is no benefit to the UK for any of the big European economies to face economic hardship.
Back to Greece, the debt exchange with private sector lenders is part of a comprehensive package announced by European leaders to prevent the Greek debt crisis from spreading to other economies, notably Spain and Italy. They also agreed last week to lengthen the repayment terms on existing bail-out loans, and lower the interest rate they were charging.
But Moody's, the credit ratings agency, points out that relatively small restructurings have often been followed by deeper defaults. It said the debt exchange only offered the country limited relief, and did not make clear how quickly Greece might be upgraded from a default rating once it is complete. In addition, austerity measures demanded by Greece's European partners and the IMF remain highly unpopular among many Greek citizens, with continuing street protests.
The downgrade means Moody's has given Greece the lowest rating of any country it rates in the world, below Cuba and Ecuador.
Clearly, continuing tough economic times for the Eurozone and UK will have a knock on effect on personal economic circumstances. Many people will simply have to shop around for better credit card deals or see what loans they can take out. And here is where, just as with credit ratings for entire countries, it's important people keep a close eye on their own personal credit rating, which can be seen in the form of a credit report. A credit report can affect whether someone is accepted for a credit card and what interest they will be offered. A poorer credit rating could result in people being offered a higher interest rate, and having to pay more if they don't pay the credit card off in full each month.
So keeping an eye on your credit report can be very important. It monitors all relevant payments which occur throughout an individual’s life time, such as opening a new account and closing an old one, even things like mobile phone payments. More importantly, a credit report registers all non-payments as well, such as missing a credit card payment. Missed payments can lead to marks on the individual's credit report.
The credit reference agencies that compile the reports are commercial companies which get the information from a number of different sources. They sell this information to lenders and other financial services companies, to help them to decide whether to grant an application for a loan, credit card, or a similar financial product.
To learn more and to see what different elements are held in a credit report, just visit http://www.creditratingmatters.co.uk - Credit Rating Matters is a membership programme which provides access to your credit report and credit score by one of the UK’s leading credit reference agency. These credit tools are provided directly by the credit reference agency, and may provide an insight into anyone's financial positioning in the eyes of lenders.
Membership with Credit Rating Matters provides unlimited, so anyone can monitor their financial position. Once details are successfully verified, people can view their credit report as often as they like. The report will update periodically and reflect changes in financial activity.
To learn more about credit reporting and how to keep your identity safe please visit http://www.creditratingmatters.co.uk for full product details, credit information and identity theft hints.
Credit Rating Matters is an online membership programme, which gives you access to your credit information held by one of the UK’s leading credit reference agency. Credit Rating Matters is a membership programme and monthly membership fees are payable after any free promotional free period has come to an end.