Consumers with limited access to credit could benefit by having their monthly phone and utility payments be included as factors in their credit scores. That's the pitch behind a new offering from credit-rating agency Experian.

Here's the catch: Anyone who signs up for the free service will need to hand over access to their bank account, a potential red flag in a climate of seemingly endless online security breaches that put personal data at risk.

An online platform called Experian Boost gives consumers the option of granting access to their online bank accounts so the credit agency can identify and record utility and telecommunications payments, Experian said Tuesday in a news release. After the consumer verifies the data and confirms he or she wants it added to their credit, the person's FICO score is immediately updated, the company said.

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The service would be of no interest to consumers with excellent credit or to lenders that don't make subprime loans. Instead, it "expands the score-able universe under FICO's scoring platform, as it allows consumers who have a more sparsely populated credit report to earn a score," John Ulzheimer, a credit expert who worked at both Equifax and FICO, told CBS MoneyWatch.

The offering's upside is it potentially gives someone a chance to obtain better credit after going through financially damaging events such as divorce, medical bills or job loss, he said. The downside is having to give Experian bank account information including user names and passwords.

"This is a way for consumers who are marginal -- either they have no credit score, a subprime score or a thin credit file -- to augment their information, in the hopes of getting them past the finish line," Ulzheimer said. "The target lender audience is lenders who have the stomach to do business with high-risk borrowers, this is not for AmEx."

Upping younger consumers' credit scores

Young consumers with little financial history and those with scores between 580 to 669 would benefit the most from its new service, according to Experian. For those with a score below 680, 75 percent saw their credit score improve, and 14 percent of those with scores of 579 or below moved to a near prime score between 620 and 679, its analysis found.

"It's all about showing you've paid recurring bills on time, which is a natural fit for building solid credit," said Ted Rossman, an industry analyst at Creditcard.com. "Experian Boost will start rewarding people for those positive payment behaviors, which should help them qualify for credit cards, auto loans and other forms of credit."

The Experian offering addresses an issue raised to Rossman frequently. "A common complaint I hear is, 'I'm responsible and pay my cell phone and utility bills each month. Why don't those things help my credit score?' The reason is that those bills aren't technically loans or lines of credit."

Experian's announcement comes two months after it introduced UltraFICO, which also involves consumers giving up access to their banking information so their history and balance could be factored into their scores.

"Access to your banking history and balance seems like it could be a slippery slope," said Rossman. "Good credit has been about paying your bills on time and keeping your debts low -- essentially, how well you manage your money, not how much money you have. I think that sort of 'access to all' should be preserved."

Experian's pitch to riskier borrowers follows a scathing congressional report last week that slammed another credit rating agency, Equifax, for failing to take basic steps to prevent a hacking that exposed the personal information of nearly 146 million Americans last year.

Experian, which has dealt with its own hacking incident, said data security is its highest priority and that consumers who use Experian Boost can stop sharing data at any time. "This is absolutely a secure process that consumers should have confidence in," the company said in an emailed statement.

