What Is Credit Monitoring?
4 Min Read | Last updated: February 16, 2024
This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.
Learn about how credit monitoring services work, the types of protection you can get from them, and whether they’re effective.
At-A-Glance
- Credit monitoring alerts you when your credit report is accessed or updated.
- Paying for credit monitoring may provide additional protection over free credit monitoring services.
- Victims of identity theft or fraud can use credit monitoring services to prevent repeat attacks.
Credit monitoring has become increasingly important as cases of identity theft have increased over the last 20 years.1 There were 441,822 cases of credit card fraud reported to the Federal Trade Commission (FTC) over the past year, making it the most common type of identity theft in 2022.1
So how do you protect yourself against identity theft? Some steps may include keeping close guard of your personal information, staying on high alert for scams, and monitoring your personal accounts.2 In this article, we’ll explore what credit monitoring is, how it works, and how effectively it can help protect your financial information.
What Is Credit Monitoring?
Credit monitoring services regularly check your credit activity and changes in your financial behavior, like applications for new accounts, unknown devices accessing your accounts, and account access in locations you typically don’t frequent.3
Sometimes, identity thieves can open accounts in your name that you won’t know about until the damage is done.4 That’s why credit monitoring services can be helpful tools to safeguard your information and protect your credit.
In addition to credit monitoring, identity theft monitoring services can help monitor activity on your online bank accounts and look out for fraudulent purchases.3
Why Is Credit Monitoring Important?
Even if you’re cautious with your personal information, that doesn’t mean everyone who has access to your personal information will be. And as more sensitive information – including Social Security numbers and credit card information – is stored online, a data breach at an online retailer or medical office can have ripple effects and end with your sensitive information in someone else’s hands.5
Credit monitoring gives you peace of mind by immediately notifying you of any changes to your credit report.3 By confirming that you or your authorized user initiated any credit activity, you can prevent fraudulent charges from damaging your accounts or your credit history.
Free Credit Report Alerts from MyCredit Guide
American Express® MyCredit Guide is a free service that allows you to view your FICO® Score and Experian® credit report. (FICO is a registered trademark of Fair Isaac Corporation in the U.S. and other countries.)
How MyCredit Guide Credit Report Alerts Work
Checking your credit report is free and easy with American Express® MyCredit Guide – and you don’t have to be an American Express® Card Member. Once enrolled, you can review your credit report and FICO® Score without impacting your credit. You can also stay on top of your credit activity. With MyCredit Guide, you’ll be alerted if there are any changes to your credit report – including new accounts opened, new inquiries, and more.
Activity that you don’t recognize could include unfamiliar transactions or account changes. These could be simple errors, but in some cases, they may signal fraudulent charges or identity theft.
Helping to Protect Your Identity with ID Monitoring from MyCredit Guide
ID Monitoring keeps an eye on your profile information across a range of internet sites on the Surface Web, Deep Web, and Dark Web. If the service detects that your profile information such as your First Name, Last Name, Social Security Number, Date of Birth, Email Address, or Primary Address has been exposed or compromised, MyCredit Guide will alert you of the specific accounts exposed, as well as recommendations for actions you can take to help secure your data and identity.
What to Do When Fraud Occurs
MyCredit Guide credit report alerts will include instructions for you to immediately confirm that a charge or credit activity is fraudulent. If you find fraudulent activity on your credit accounts, you will need to get in contact with your credit card companies to begin the process of protecting your accounts.6 Your credit card issuer is likely to cancel the card that has been compromised and issue you a new one.6
Immediate Access to Your Credit Report
If you receive an alert about a change that looks unfamiliar, you can immediately view your free full monthly credit report through MyCredit Guide. If something still doesn’t look right, you can take action.
Did you know?
As an added security measure to help protect against fraud, American Express reports a reference number to credit bureaus – instead of your actual account number.
Free Credit Monitoring vs. Paid Credit Monitoring
Your bank or credit card company may offer free credit monitoring services.3 Some credit knowledge services, like MyCredit Guide, do not provide a full array of credit monitoring services. However, MyCredit Guide creates credit alerts for card members and non-card members alike.
Paid credit monitoring services will bill you on a monthly or annual cycle. They may offer additional benefits, like dark web and public records monitoring and credit report monitoring from all three credit bureaus. These paid services may also offer insurance protection, meaning you may not be held liable for charges that occur when your identity is compromised.3
It’s important to understand what is covered by your credit monitoring service. If you choose a paid service, consider the factor that price plays in your budget, as some of these paid credit monitoring programs can cost several hundred dollars per year.7
What Credit Monitoring Program Is Right for You?
The right credit monitoring service depends on your personal situation, but it can be wise to have a credit monitoring system to help prevent fraudulent activity. If you have been a victim of identity theft in the past, it may be a good idea to pay for a comprehensive coverage plan to stay protected.
Frequently Asked Questions
Besides using a credit monitoring service, you can do the following to monitor for signs of identity theft:3
- Review your bank accounts, credit reports, and any other sensitive information regularly.
- Regularly change your passwords using two-factor authentication.
- Review notices or bills from your healthcare providers and insurance companies.
- Monitor your mail for any new or suspicious accounts.
Credit monitoring services do not hurt your credit score, but they do help you identify errors or potentially fraudulent activity – so you can take steps to address them before they cause damage to your credit score.8
Credit monitoring can’t provide complete protection against fraudulent activity. It can’t notify you of fraudulent attempts to withdraw money from your bank account, attempts to file a tax return with your Social Security number, or prevent anyone from using your identity to apply for credit.3
The Takeaway
Knowing your needs and understanding the information you receive from each option can help you choose the best plan for your needs. But take advantage of any free credit services that are offered to you. For example, you can enroll in MyCredit Guide to access your credit report and explore credit building tools any time. That way, if you receive an unusual alert, you can request an immediate copy of your credit report for assessment.
1 “Consumer Sentinel Network Data Book 2022,” FTC
2 “Identity theft,” USA.gov
3 “What To Know About Identity Theft,” FTC
4 “Warning Signs of Identity Theft,” IdentityTheft.gov
5 “Data Breach of Your Personally Identifiable Information,” IRS
6 “Steps to Take if You Are the Victim of Credit Card Fraud,” Experian
7 “What is a credit monitoring service?,” Consumer Financial Protection Bureau
8 “Does Credit Monitoring Hurt Your Credit Score?,” Experian
Anna Davies is a writer and content marketing strategist who specializes in the personal finance space. Bylines have appeared in New York, Refinery29, Cosmopolitan, Glamour, and others.
All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.
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The material made available for you on this website, Credit Intel, is for informational purposes only and intended for U.S. residents and is not intended to provide legal, tax or financial advice. If you have questions, please consult your own professional legal, tax and financial advisors.
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