The Credit Information Corp. (CIC), in its bid to provide readily available credit to the borrowing public, has accredited three more credit bureaus to help safeguard and make more efficient the delivery of financial services across the economy.
At the CIC news briefing on Monday held at the Peninsula Manila Hotel in Makati City, the three accredited bureaus a signed a subscription agreement formally accepting CRIF Philippines, Compuscan Philippines and CIBI Information Inc. into the fold of recognized credit bureaus. All three have submitted all requirements demanded by the Securities and Exchange Commission (SEC) under Memorandum Circular 7, Series of 2015.
“Accreditation of this new set of special accessing entities, or SAEs, is our [belief] that the CIC is a viable business model, that there is a need for credit information and other value-added services in the financial sector, and that the CIC is now set to move forward with our objectives and partnerships to reinforce its virtues of making credit easily available to the public through the alliance of both credit registry and bureau,” said Jaime Casto Jose P. Garchitorena, CIC president and CEO.
The accredited SAE’s were granted regulated access to credit data by CIC. The information will serve as elements for the improvement or development of statistical models and will serve as base for a range of value-added products.
The partnerships were to help widen the information channels and product distribution is in-line with CIC’s goal of making credit readily available to more Filipinos. The promotion of financial literacy in all activities is also a goal of the partnerships, as it wants people to have heightened awareness of their own credit reputation and ranking in the credit economy.
“Six credit bureaus were provisionally accredited as SAEs. Transunion Information Solutions Inc. was the first to execute the subscription agreement with the CIC on May 5,” he added.
Of the six companies, five of the accredited companies are foreign owned, coming from South Africa, Italy, South Asia, Singapore and the United States. The CIBI information Inc. is the sole locally owned company among the SAE’s. The SAEs have a presence in the major cities and have specific markets for their products, including banks serving specialized lending in the so-called unbanked segment.
According to Republic Act 9510, or the Credit Information System Act, lending institutions need to submit both positive and negative credit information of their borrowers to CIC. According to SEC guidelines, SAEs must have a minimum paid-up capital stock of P50 million. SAE applicants shall also be evaluated on their experience, capability to operate a credit bureau and must implement up-to-date and appropriate technology, among others.
“The accreditation was done, both to assure the quality of services that the SAE’s will deliver and to change the public’s perception about borrowing or the utilization of credit. It’s an alliance, more than a partnership, because both the CIC and the SAEs are working toward a common goal: addressing the lack of reliable credit information in the country,” Garchitorena said.