Credit information agencies are to be barred from giving confidential data to private detectives and direct marketing firms under tough guidelines proposed yesterday. The Privacy Commission wants to stop the territory going down the same road as the United States where details of credit applicants are widely available to outside users. About 15 per cent of complaints received by the commission relate to the credit industry. Credit card advances increased from $1.05 billion to $23.7 billion between 1986 and 1996 and indebtedness from $29.4 billion to $129.3 billion. The proposed code of practice governs the collection and use of data by credit reference agencies which supply banks with borrowers' financial histories. It comes as the Credit Information Services, the main agency, plans to revamp its system. But Privacy Commissioner Stephen Lau Ka-men yesterday warned far more people could end up on databases unless the industry was 'ringfenced'. Mr Lau added: 'Increasingly we are living in a credit society. We believe there is a need for clear ground rules to be laid down. 'A code of practice will help the credit industry ensure they have the right information and provide greater transparency for the consumer.' A major problem is the failure of agencies to update information when debts are repaid which means banks wrongly refuse credit. Another source of complaint is banks passing on names of debtors' referees to debt collecting agencies. Mr Lau said the code would make it easier for people to access their own records and get data corrected. The draft recommends lending houses notify a credit reference agency within two days of repayment of a debt. Banks should inform clients their data may be passed on to a named credit reference agency. If credit is refused applicants must know where they can get a copy of any agency report used. The draft says agencies should restrict personal files to defaults and repayments, debt and bankruptcy judgments and hire purchase arrangements. Loan default data must be erased after five years.