The Credit Information Corporation or CIC, aiming to have credit access available to the public and to have the country’s comprehensive, centralized, and reliable credit information system, recently accredited 3 additional credit agencies as its Special Accessing Entities (SAEs).
CRIF Philippines, Compuscan Philippines, and CIBI Information, Inc., has been formally accredited to join the team with existing accredited bureau, Transunion Information Solutions, Inc., making a total of 4 SAEs to work hand-in-hand with CIC. The signing of the Subscription Agreement held recently in Makati in accordance with the requirements stated in the SEC Memorandum Circular No. 7 Series of 2015.
Pursuant to Republic Act No. 9510 or the Credit Information System Act, the Credit Information Corporation (CIC) was set up to become the government-owned and controlled central registry of credit information in the Philippines. The CIC shall collect, consolidate, and share information relevant to credit-related activities of all banks and other entities participating in the financial system.
Headed by its President and CEO, Jaime P. Garchitorena, CIC is under the Securities and Exchange Commission and is supervised by the Governance Commission for government-owned and controlled corporations.
Mr. Garchitorena said,
“Six credit bureaus were provisionally accredited as SAEs by the CIC. Transunion Information Solutions, Inc. was the first to execute the Subscription Agreement with the CIC last May 5, 2016. Accreditation of this new set of SAEs is our offer that the CIC has 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.”
The partnership will be beneficial to both sides of the financial equation. Bankers, lending institution and even small-scale credit company may have the appropriate information in evaluating on an individual’s credit application. Access to this information will have to go through a proper and legal procedure to protect also the consumer’s private information. On the other hand, an individual can also have vital knowledge regarding his/her credit score, its’ current standing in the financial marketplace, and can also function as a tool to supervise his/her credit account. Even an individual’s paying behavior or payment pattern history can be used as guidelines in their financial planning.
Once credit bureaus are fully accredited, the CIC shall grant the SAEs, regulated access to the CIC’s credit data which will serve as elements of the SAEs’ statistical models and can be used as a basis for a wide range of other products and services being offered. These partnerships are also designed to widen the channels of information and product distribution in line with the policy mandate of the CIC to make credit readily available to every Filipino. An intensive awareness of their own credit reputation and ranking in the credit economy through the SAEs value added services are also a part of a goal in providing financial literacy to individuals and entities concerned.
Mr. Garchitorena also stressed in an interview that this is a milestone in the country’s financial system. Imagine a farmer or a fisherman even in far-flung part of the country may have an equal opportunity to avail of a loan as a starter even if they don’t have any credit information yet to look upon. He gave an illustration and yet feasible, the introduction of the Telcos offers for a mobile plan or prepaid ones in rural areas for a local fellow to have a basic credit info on his own. Since mobile devices are major tools in telecommunication, it is a necessity for a ‘Mr.Farmer’, ‘Mr. Fisherman’ and ‘Ms. Vendor’ to have a cell phone or mobile gadgets. This is a good start up for them to be included in the credit database. So approving a credit loan application to upgrade a fishing boat or a farming tool will be accessible for a financial institution process.
As a closing remark, Mr. Garchitorena said,
“The accreditation was done, both to assure the quality of services that the SAEs will deliver and to change the public’s perception about borrowing or utilization of credit. It is 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.” He also noted that five of the accredited companies are foreign owned corporations while CIBI Information, Inc. is the sole locally-owned company. He too pronounced that the involvement of the international credit bureaus to manage business in the Philippines is a dependable indication of confidence in the positive vision and management of the CIC and the Philippines’ Credit Information ecosystem.”