Winning the Talent War: How Credit Checks Help Ensure Hiring Success

In today’s fiercely competitive talent market, hiring the right person is crucial. With an average cost per hire of around HK$35,917 (US$4,700) and even higher for executives, reaching up to HK$218,100 (US$28,000),¹ the impact of hiring mistakes can be significant. That’s why thorough background checks play a pivotal role in helping employers mitigate these risks and make informed hiring decisions. Here are three valuable tips to guide your transition and empower informed decision-making. 

Credit checks, an integral part of an employee’s background screening, have become increasingly important. Latest research from TransUnion® showed particularly when hiring for finance and security-related roles, industries like business services (96%), financial services (80%) and insurance (78%) — key pillars of Hong Kong’s economy — prioritise employee’s financial stability.²  Given the sensitive nature of their roles, companies seek talent with high integrity to fill such positions. Employers rely on credit checks to assess candidates’ financial trustworthiness as financially stable talent are more apt to safely handle business assets.  

Regulations around such positions have even become more stringent. According to the Hong Kong Monetary Authority, employers may question an applicant’s eligibility if their credit records indicate financial vulnerability.³  As well, bankruptcy records may affect the approval of licence applications for certain professions, such as securities brokers and lawyers.

A candidate’s credit history could reveal financial mismanagement patterns, including late payments, defaults or bankruptcy. Employers may view this inability to effectively handle financial responsibilities as a potential risk, affecting the applicant’s capacity to perform certain work-related elements or safeguard confidential information. It could even raise concerns about the candidate’s reliability and trustworthiness.  

The same research from TransUnion surprisingly revealed only 5% of Hong Kong’s HR professionals incorporate credit checks into their hiring procedures — despite 72% recognising the higher reputational, legal or financial risks associated with omitting them. 

Amid complex regulatory environments, organisations bear the responsibility of maintaining compliance when hiring talent. Understanding a candidate's credit history can help ensure financial trustworthiness and identify reliable fits for critical roles, thereby minimising the risk of internal fraud or employee financial misconduct. To achieve this, organisations should engage with trusted partners that can provide valuable, data-driven insights, as well as robust tools and advisory services. One such solution is TransUnion TruEmpowerᵀᴹ Credit Report for Employment. These credit checks serve as an objective assessment of a candidate's financial stability, enabling informed hiring decisions from the outset and throughout an employee’s career.

Contact us to explore TransUnion solutions that can help enhance your recruitment process and enable you to make informed decisions when evaluating potential candidates or re-assessing current employees.