Thousands of borrowers with otherwise unblemished credit records face being turned down for loans and credit cards because the accounts they took out before 2000 do not appear on their credit reports, it has emerged.

Up to 50 million active accounts of all types, including mortgages and credit cards, do not appear on credit files held by credit reference agencies.

But having no repayment record can be just as damaging to your chances of being accepted as a borrower as a record showing missed payments.

Walletpop is therefore encouraging people in this situation to take out a so-called credit builder card to demonstrate their creditworthiness.

Under the Data Protection Act it is illegal for any bank or building society to share information about customers without seeking their consent.

Banks and other lenders are therefore unable to share information about accounts taken out before 2000 because their terms and conditions did not include permission from customers to pass their details to other organisations.

Anyone who has not taken out a new account since then will therefore appear as an unknown entity to a lender searching their credit report to decide whether or not to accept them as a customer.

With the majority of lenders now relying on automated computer systems to decide whether a potential customer is a good bet or not, this can often lead to an individual being rejected - through no fault of their own.

This is particularly true in the current financial climate as most banks and building societies remain nervous about accepting new customers with less-than-perfect credit files.

A spokeswoman for the consumer pressure group Which? said: "A missing account could have a significant impact on a lending decision. We do not think anybody should be forced to agree to share data, but if you are applying for credit it makes sense that lenders see what other accounts you have open. It is vital that the Government and the industry work out a solution to this problem."

Data protection is not the only reason that your credit report might appear on the thin side, though.

Not all banks and building societies have signed up to industry-wide practices of sharing information about borrowers, even if customers have given permission.

There is no legal requirement for high street lenders to exchange information and under the current rules financial institutions can receive only the same amount of information as they are willing to share.

The odds are also skewed against consumers trying to get credit as negative data about events such as missed payments or county court judgments is generally shared, but positive data, for example showing that customers have paid debts on time, is not always made available to credit-reference agencies.

Neil Munroe, of Equifax, said: "A lack of information on your credit file will affect a lender's decision. The more positive data you have on your file, the better the interest rate will be that you are offered or the more likely you are to be offered the deal. However, it depends on the lender as to whether your positive data is shared."

David Hollingworth, of broker London & Country Mortgages, said: "Lenders do not have the staff to check every application manually. All the major lenders base decisions on credit scoring, which is done electronically, typically based on information supplied by credit-reference agencies.

"Any file which doesn't fit the norm, for whatever reason, is likely to be rejected under this system."

A White Paper produced last year promised further action to improve the amount of information at the disposal of lenders. However, it is not only missing accounts that can harm your credit score.

Mistakes are also common, and can severely damage your chances of being accepted as a borrower.

Recent research conducted by Which? found that about one in six files held by credit reference agencies contained errors.

Consumers should order a copy of their files at least once a year from each of the main credit-reference agencies because banks and building societies share different levels of data with the different companies.

In the coming weeks the Government is expected to announce plans to allow consumers to access their credit reports online under a statutory scheme in which the cost will be set at £2, the same price that it costs now to order a copy through the post.

In the meantime you can order a copy by visiting the websites of Experian and Equifax, or by downloading a form available on the Callcredit site.

The three agencies also offer premium online services for customers willing to pay for a subscription, including credit scoring and e-mail alerts when changes are made to a credit file.

If you believe that information is missing from your file, contact your bank or building society and ask for your information to be shared.

You could also contact the various credit reference agencies and ask them to amend your file.

Other steps you can take to repair your credit file and improve your chances of being given approval for a loan or a new account include making sure that you are registered on the electoral roll and closing old credit cards or overdrafts that you are not using.

Another good move if you find yourself being refused for credit is to take out a credit card aimed at those trying to build a better credit rating and repay the balance every month. This will demonstrate that you can manage your credit responsibly.

Cards that fall into this category include Barclaycard Initial, which has an interest rate of 27.9%, and Capital One's Classic card at 34.9%.