The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The Central Bank’s Governor yesterday said legislation to establish a Bahamian Credit Bureau was being finalised, with bids from potential operators now in and under assessment.

Wendy Craigg expressed hope that the Bill creating the Credit Bureau will be passed in Parliament before year-end, as the Central Bank worked on tha ‘parallel process’ of selecting a preferred operator for the facility.

“We have been doing quite bit of work on preparing for the introduction of a Credit Bureau that would provide lenders, all lenders, with more information on the indebtedness of their customers,” Mrs Craigg said.

“There is no comprehensive information available at this time to a lender. You actually have a situation where borrowers know more about their indebtedness than lenders do. That is not a good thing.

“What we are trying to do is put in an infrastructure that will provide this information. The Credit Bureau will be collecting that information and collating it, and then making it available to lenders so they can make more informed decisions on loans.”

She added: “We have completed the public consultation phase. We have had  a concurrent process, a request for solution process, running. That has been completed in terms of us receiving those responses from potential providers of the Credit Bureau services.

“We have been reviewing those proposals in order to shortlist them, and to come up with a preferred provider that we can put forward at the time when the legislation is finished.

“The legislation is now being finalised and put in a form that can be provided  to the Government for presentation eventually in Parliament. We hope that that will happen in the course of this year.  We are working with them to make that happen.”

Credit Bureaus collect personal and financial information on persons and companies, and then provide this to lenders via a credit report. A Credit Bureau’s clients typically include banks, mortgage lenders, credit card firms and other financing companies.

It is expected that such a facility will help Bahamian borrowers improve their credit and payment behaviour, while lenders will have increased access to accurate and more comprehensive information about borrowers’ credit history and payment habits. This, in turn, will reduce their exposure to risky loans.

Only loan agreements entered into after its introduction will be included in the Credit Bureau’s records. Outstanding court judgments and liens will be the only historical records contained in its database.

Among the information provided by a lender to the Credit Bureau is the nature and amount of the loans granted to a borrower; the security taken for them; nature of any guarantees; and any information on the borrower’s income, creditworthiness and financial transaction history.