Piggybacking and tailgating are security terminologies which are also encountered in finance. Even though the terms are very much similar in meaning, a thin line of differences separates them. In literal contexts, piggybacking refers to the act of tagging along with someone who has legal entry rights to a place. The aim of the piggybacker is usually to ride on an authorized figure in order to gain personal access to a service. Depending on the circumstances, the act could be lawful or not. But many a time, the authorized person is aware of the piggybacker.
On the other hand, tailgating also talks about the act of trailing someone to gain personal favor without the person’s consent. Example, when a car driver drives behind another vehicle for a selfish reason. In financial contexts, the meanings of the terms change slightly — instead of talking about cars or illegal following of another person, we turn our attention to money, credit cards, and investment.
Piggybacking & Tailgating in Finance
It’s a way of increasing your credit score by getting someone of high credit standing to add you to their credit card. By so doing, you also become an authorized user. But how is this possible? Well, this is what happens behind the scenes: when an account holder of high credit reputation adds someone to their account and authorizes them as a user, the payment history of the reputable account will also reflect in the credit report of the piggybacker, and thereby boosting their credit score. If this is in line with your interests, then here are some credit tradelines for sale.
NB: There’s always a catch in every loophole. The credit scores of a piggybacker can turn towards a positive direction, provided the payment history of the primary account holder is positive and has a low balance. On the other hand, a credit piggybacker may end up in a worse credit situation if the primary account user has a bad payment history.
Moreover, there may be some risks associated with piggybacking. So, it’s always better to know and trust who you are dealing with since piggybacking is only a short-term solution to boosting credit scores.
Tailgating is a situation whereby a broker or an agent of investment buys/sells a service (e.g. security) to a customer, and then goes on to carry out a similar transaction for himself. Even though tailgating is strictly not illegal per se, it’s still seen as unethical conduct. The investment industry simply frowns on the act since it could be dangerous security wise.
For instance, assuming a financial advisor buys $100 worth of shares for his client, and then goes on to use the clients’ information to buy himself another $100 of shares. This habit may comprise the security of the participants involved.
In summary, piggybacking is not exactly the same as tailgating, but the two terminologies are closely related, in that they both refer to the act of relying on another person in order to gain an advantage somewhere.
Piggybacking credit could potentially help you to increase your creditworthiness if you partner with the right person or company. However, you still must understand that some piggybacking services are risky and expensive.