Obtaining Credit; a Struggle for Expats

Moving to the United States (or any new country) takes a lot of planning and work, everyone knows that with visas, finding jobs and accommodation, and schools for your kids, there are tons of big challenges that everyone faces when relocating to a new country. However, there are lots of things that might not be such instantly obvious hurdles to those moving to a new country, but can actually turn out to be a massive problem once you are there. One of the most surprising of these is establishing credit.


Basic credit scores are usually calculated nationally and scores often do not translate internationally. This can result in a lengthy, paper-heavy process for expats who have to go through manual underwriting processes to apply for credit in a new country – even if they originally left their homeland with a good job and a high salary. Frustratingly, a lot of people get back results with low limits and high interest; definitely not ideal.

Credit can be required for getting access to basic necessities like mobile phone contracts, credit cards, certain bank accounts, mortgages even home internet service! Aneesh Varma, who had these problems when he moved to the UK years ago with his job at J.P. Morgan, said his difficulties had inspired him to begin a startup, Aire, that works to help establish alternative credit scores for people with scarce credit files in this country, expats included.

A Financial Passport?

Aire aims to overcome the fact that the current credit system was established in the 20th century, and is totally data driven so without sufficient data, there is difficulty in accessing credit. Varma’s vision is to create a kind of international “financial passport” that factors into account alternative data such as profession, job history, and cognitive and decision making skills. However, Aire and similar companies are still in their very early stages, and financial planners do advise expats to prepare for obstacles when establishing credit abroad.

Expats report finding mobile phone contracts a difficulty, and many have had to settle for using pay-as-you-go mobile phone plans as their access to longer-term agreements has been denied. In some countries, expats will also need a certain amount of credit for a long term broadband contract. Credit cards are also listed as another common problem, with many expats having to start from scratch to establish credit abroad, beginning with basic cards and slowly building up credit over time. And finally, mortgages can create a big problem, as mortgages for non-citizens can be very difficult to obtain.