Establishment of the Central Credit Information Corporation and the Credit Information Syste
There are many users of credit data, foremost of which, are banks and other lending institutions. Credit card companies, insurance companies, finance companies and even appliance or car retailers and microfinance institutions need credit data in one form or another. Different countries have responded in varying manner on how to address the need to access accurate and up- to-date credit information.
Some countries have a public credit registry while others operate via one or several private credit-reporting firms. There are different institutional arrangements for private credit registries, ranging from a model where there is ownership by banks or bank associations or the local Chamber of Commerce to one that is publicly owned –typically by the Central Bank. There are advantages as well as disadvantages to these arrangements, depending on the country’s financial and economic situation. For instance access to bank-held data may be facilitated if the registry is affiliated with bank associations and may have broader coverage, if it is likewise affiliated with the local Chamber of Commerce. On the other hand, there may be restrictions on access to data and independence of the credit bureau could likely be questioned. Both public and private registries however can be found in developed and emerging market economies. Both models rely on reciprocity or mutual information exchange whereby the supplier of information has access to the rest of the database available in the credit bureau or registry.