Credit bureau calls for monthly reports from data providers

Terrence Cooper- CEO,CRIF NM

Terrence Cooper, CEO of CRIF NM Credit Assure Limited — one of three credit bureaus operating locally — says that irregular reports from financial institutions are affecting the sector’s ability to properly assess the credit market.

The credit data provider is suggesting that under new legislation being considered for the sector, the making of monthly reports should become mandatory.

Credit bureaus collect credit information from lenders and others on a borrower’s credit history and provides this to lenders on request, allowing them to better assess credit worthiness. The Credit Reporting Act 2010 introduced the licensing regime for credit reports locally. Licensed credit bureaus which are currently in operation are CRIF NM, Credit Information Services, and Creditinfo Jamaica.

Cooper said that changes to the law are already being contemplated to shore up weaknesses that have become evident in the system. Any amendment, he said, should also address spotty reporting by financial institutions.

“What we are saying is that all companies that pull/use credit reports should also be reporting their client data (monthly payment patterns) into the credit bureau... as some credit information providers (CIPs) are more committed to submitting their data than others, and in some cases this creates an uneven playing field,” Cooper told the Jamaica Observer.

The CEO said as well that currently the bureau is unable to assess trends in the credit market “as there are still a number of larger financial institutions that have not yet started to report their data into the credit bureau, and that could skew the outcome”.

The bureau head said that expansion of the type of CIPs to include landlords and debt collection agencies is also needed.

He expressed optimism that changes in train will improve levels of available data.

“We expect that in 2016 we will be in a better position to do these types of analysis more accurately,” he stated. “Things are progressing along… all the major banks are now using credit reports as part of their loan application process.”

Although he said there was some selective usage of the reports, usage was nevertheless “steadily increasing”.

Cooper noted that since 2010 the legislation has been amended to now include utilities and telecommunication companies and trade manufacturers who provide credit (including Singer and Courts), stating: “We are now engaged with all facets of these vertical markets.”

“The types of users are growing and we now have a wider cross section of users ­– from banks to micro-finance companies and SMEs, and we are getting interest from some of the larger hotels as well. As mentioned, the business is steadily growing and we expect there to be further changes to the Act that will expand our opportunities for growth,” Cooper said.

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