A new survey found Americans spent an estimated $1.4 billion on credit freezes in the wake of the massive data breach at credit reporting company Equifax that exposed the personal information of nearly half of the country.
The massive figure comes from a study conducted by Wakefield Research and commissioned by business loan provider Fundera. The research found that nearly 20 percent of Americans froze their credit with one or more of the major credit bureaus after the Equifax breach was made public.
The survey asked 1,000 adults in the United States to self-report how much they spent on credit freezes after learning of the massive data breach at Equifax. Thirty-two percent reported spending $10 or less on a freeze, while 38 percent reported freezes costing them $30 or more. On average, consumers paid about $23 to freeze their credit.
A credit freezes places a lock on a person’s credit score that prevents lenders and others from being able to view the credit file. It is an essential tool to prevent identity theft, as it makes it considerably more difficult for a thief to open a new line of credit in a victim’s name.
Following the Equifax data breach—which exposed the personal records, including social security numbers, of more than 148 million U.S. residents—Americans were encouraged by credit bureaus, experts and lawmakers to freeze their credit in order to protect their identities.
However, implementing a credit freeze costs money. The fee to have one of the three major credit reporting bureaus—Equifax, Experian and TransUnion—to freeze a person’s credit can often cost between $3 and $10 per request. Freezing credit at all three bureaus could cost up to $30.
Additionally “thawing” the accounts, or removing the freeze, can also carry a fee of up to $10.
Lawmakers have pushed for credit reporting firms to allow consumers to freeze their account without paying, and have gone so far as to include a provision in a recent bill that would require credit freezes be made free. The bill, a controversial rollback of the Dodd-Frank banking regulations, has already passed the Senate and is awaiting a vote in the House of Representatives.