Is Credit Monitoring A Good Way To Protect Your Identity?

Is Credit Monitoring A Good Way To Protect Your Identity?

Written by Mark Gregorski
Fact-checked by Caitlin Wood
Last Updated January 23, 2023

Identity theft is a crime that can wreak havoc on your finances and do severe damage to your credit score. Sadly, it occurs far too often, and even the most vigilant consumer can end up becoming a victim.

Data breaches, lost wallets, and even mail theft can put your personal information into the hands of criminals. With this personal information, these criminals can then apply for new credit cards, loans, and other accounts in your name.

To help address the problem of identity theft, credit reporting agencies offer individuals in vulnerable positions credit monitoring services. Read below to find out what this service is, how it can help you, and where it falls short, as well.

What Is Credit Monitoring? 

Credit monitoring is a paid service that helps you keep track of changes to your credit report. Whenever a change occurs, the credit monitoring service provider will notify you. As an example, if a lender conducts an inquiry on your credit report to process a loan application, you’ll receive an email or mobile notification alerting you of the action. Credit monitoring services track a wide variety of changes that impact your credit report, including late payments, credit score changes, new accounts, and updates to your personal information.  

Does Credit Monitoring Protect You from Identity Theft?

Yes and no. Credit monitoring is a reactive solution rather than a proactive solution to identity theft. There aren’t any safeguards in place that actually prevent unscrupulous individuals from taking advantage of stolen information. The monitoring system in place only alerts you to changes that appear on your credit report – it’s up to you to take action to remedy any unauthorized charges or credit checks.

Credit monitoring services can lull you into a false sense of security, convincing you that your personal information is safe when it’s still vulnerable. However, it does serve a useful function by sending you fraud alerts, allowing you to take swift action to rectify any fraudulent activity.

Interested in getting fraud alerts? Check out our list of credit monitoring services.

Where Can You Get Access To Credit Monitoring Services?

Monthly PriceFeatures
TransUnion$24.95– Get key credit report alerts
– Unlimited access to credit report and score
-Personalized debt and credit analysis and advice
– $50,000 identity theft insurance
Equifax$19.95 or  $29.95– Identity theft insurance
– Identity restoration  
– Lost Wallet Assistance
– WebScan
– Credit Score Trend 
BorrowellFree– AI credit coach
– Product recommendations
First Report$12.99 or $19.99– Monitors both credit reports
– Monthly credit scores, quarterly credit reports
– Historical scan
– ID restoration
Marble Premium $29.99– Credit Scores Simulator
– Budget Simulator
– Track Spending
ID Assist$14.99 or $19.99– Monitors both credit reports
– Monthly credit scores, quarterly credit reports
– Historical scan
– ID restoration
Free Equifax credit score

Pros Of Credit Monitoring

  • If you’re trying to build your credit scores, it can help you keep tabs on your credit scores progress.
  • It can alert you of any suspicious activity such as a new credit account opened in your name.
  • You’ll be able notified of any missed payments.
  • Some credit monitoring services come with additional tools and services that can help you monitor and build your credit scores. 

Cons Of Credit Monitoring

  • Most credit monitoring services will have a monthly fee. These fees can range from anything between $9.99 and $34.99 a month.  
  • Credit monitoring does not prevent identity theft. It only helps you identify it quickly.

Is There A Way To Stop Identity Theft From Happening In The First Place?

Though criminal identity theft tactics are growing increasingly sophisticated, there are many things you can do to mitigate the risk of becoming a victim, such as:

  • Store sensitive documents in a secure location.
  • Only provide sensitive information if necessary, whether in person, by phone, or online.
  • Conduct online purchases only on safe websites.
  • Use complex passwords online and change them often.
  • Destroy financial documents before discarding them in your trash.
  • Keep your virus protection and firewalls updated on your computer.
  • Don’t download files or click on links that you don’t know.

However, if your information has already been stolen, there’s little you can do to prevent it from being used by criminals. Your best plan of attack is to habitually monitor your credit report, bank statements, and credit card statements for suspicious items. Should you discover evidence of fraudulent activity, submit a dispute with the credit agencies right away.

What Should You Do if You’ve Been A Victim Of Identity Theft?

No one is immune to identity theft. If your identity has been stolen, remember to not be hard on yourself or allow anxiety and fear to dominate you. Follow the steps below to remedy the harm done and prevent the situation from escalating further:

  1. Contact the credit agencies to place an alert on your credit report. This warning will encourage lenders who access your report to contact you and verify your identity.
  2. Keep detailed records of your phone calls.
  3. Follow up with individuals you’ve been in contact with, ensuring you have a record of any agreements made.
  4. Make copies of all original and relevant documentation related to the incident, including police reports and correspondence with companies. 
  5. Keep all files related to the incident stored away as evidence in case the issue remerges.

Credit Monitoring FAQs

Is credit score monitoring worth it?

Credit score monitoring can be valuable in a number of ways. For one it can help you keep track of your credit if you’re looking to build your credit scores. Secondly, if you’re concerned about identity theft it can help alert you of any suspicious activity. However, it’s important to note that it cannot stop identity theft. It can only help you identify the early signs of it, so that you can take appropriate action to stop it.

How much does credit score monitoring costs?

Depending on the provider you choose credit monitoring services can cost you anywhere between $9.99 to $34.99.

Which service providers offer credit monitoring services?

In Canada, both the credit bureaus; Transunion and Equifax, offer credit monitoring services to their clients. Third-party providers like Marble, Borrowelland RBC also have programs that offer credit monitoring.

Bottom Line

Though credit monitoring has its flaws and limitations, the service effectively warns you of fraudulent activity on your credit report, allowing you to take action to erase it from your credit history. Unfortunately, credit monitoring doesn’t directly stop identity theft, nor does it act as a deterrent against thieves.

A better alternative to credit monitoring is a credit freeze, enabling you to lock your credit file, preventing anyone from opening an account or performing a credit inquiry. Sadly, credit freezes are currently not available in Canada. However, with identity theft becoming an increasingly common problem, public pressure could eventually require credit agencies to offer free credit freezes for all Canadians.

Rating of 5/5 based on 2 votes.

Mark is a writer who specializes in writing content for companies in the financial services industry. He has written articles about personal finance, mortgages, and real estate and is passionate about educating people on how to make smart financial decisions. Mark graduated from the Northern Alberta Institute of Technology with a degree in finance and has more than ten years' experience as an accountant. Outside of writing, he enjoys playing poker, going to the gym, composing music, and learning about digital marketing.

Click on the star to rate it!

How useful was this post?

Research & Compare

Canada's Loan Comparison Platform

Largest Lender Network In Canada

Save time and money with Loans Canada. Research and compare lenders before you apply. Share your experiences with Canada's top lenders.

Save With Loans Canada

Special Offers

Up to $1,500 Cash Back

Up to $1,500 Cash Back
Mortgage offer

Frank Mortgage is Canada’s one-stop shop for mortgages. Get up to $1,500 cash back on your mortgage.

View Offer
Improve Your Credit With Fidem

Improve Your Credit With Fidem

Great unsecured credit card for customers currently in, or recently discharged from, a consumer proposal or bankruptcy

View Offer
Earn 5% Cashback With Neo

Earn 5% Cashback With Neo
No annual fee!

Earn an average 5%¹ cashback at thousands of partners and at least 0.5%² cashback guaranteed with Neo.

View Offer
Build Credit For $10/Month

Build Credit For $10/Month

KOHO’s Credit Building Program helps you build a better credit history with easy to manage payments for just $10/month.

View Offer
Best Personal Loan Provider by Greedy Rates

Confidential & risk-free

All consultations and conversations with Loans Canada and its partners are confidential and risk-free. Speak with a trusted specialist today and see how we can help you achieve your financial goals faster. Loans Canada and its partners will never ask you for an upfront fee, deposit or insurance payments on a loan. Loans Canada is not a mortgage broker and does not arrange mortgage loans or any other type of financial service.

When you apply for a Loans Canada service, our website simply refers your request to qualified third party providers who can assist you with your search. Loans Canada may receive compensation from the offers shown on its website.

Only provide your information to trusted sources and be aware of online phishing scams and the risks associated with them, including identity theft and financial loss. Nothing on this website constitutes professional and/or financial advice.

Your data is protected and your connection is encrypted.

Loans Canada Services Are 100% Free. Disclaimer

Build Credit For Just $10/Month

With KOHO's prepaid card you can build a better credit score for just $10/month.