Your last 200 bill payments, on average, will become part of your credit record - available for scrutiny by banks and other businesses - under a proposal by the Privacy Commissioner.

The plan, now open for public submissions, would put your bill-paying on your credit record for two years, showing whether you were late with your electricity, gas or phone bills, mortgage or credit-card invoices, insurance, or other monthly payments.

The banking industry says the plan means staying on top of bills will get you a better credit rating and better access to loans, while people struggling to pay will avoid loading up more debt.

Credit records now show only the times when you have inquired about getting credit, and any defaults.

In practice, they are updated only when things go wrong.

"It has been quite difficult to get rid of bad credit experiences," said Consumer NZ chief executive Sue Chetwin.

She said giving credit-reporting agencies more information every month made it easier to rebuild a credit record.

"You can show you've rehabilitated yourself," Ms Chetwin said.

The proposal, which the Privacy Commissioner admits is "intrusive", would start recording from April next year whether bills were paid on time.

Credit-reporting agencies would be given authority to collect the information, but it would be up to individual companies - such as telephone and power companies and banks - to join up to gain access to it.

They would have to provide their customers' information to gain access to the databases.

Repayment histories would be presented as a monthly yes or no on whether due dates were met for each account a person held.

The commissioner's office says this is likely to cover about 100 payments a year for the average person.

Bankers Association chief executive Sarah Mehrtens said missing a single phone bill payment was unlikely to affect whether a person could get a loan, especially if they had records of long-term regular repayments.

The managing director of credit-checking agency Veda Advantage, John Roberts, said more information would let creditors look at the big picture.

"If someone misses a payment one month because they were overseas and forgot to pay the credit-card bill, it's not going to be a big issue. It's about trends ..."

Council for Civil Liberties spokesman Batch Hales said last week that the collection of sensitive personal information was risky, even if there were attempted safeguards.

"It's not a transparent system ... You ask any ordinary person around New Zealand what their credit rating is and they'll look at you quite blankly," Mr Hales said.

"They don't even know this process exists, and they don't know how to challenge it."

Federation of Family Budgeting Services spokeswoman Margaret Elsworth said there were benefits to the changes, but they also caused some anxiety.

"It would be good to know when you're a creditor that you're dealing with someone who can pay.

"But at the same time, do people want all that information out there?"