National ID cards impedes bank borrowers’ information

NONE Possession of the national identification cards has been cited to be slowing down the process of getting adequate information from banks’ money lenders in the country, a Credit Bureau Chief has observed. The Chief Executive Officer of the Dun and Bradstreet Credit Bureaus Limited Miguel Llenas made the observation last week in Dar es Salaam during a press conference and noted that his firm has been encountering such minor problems especially when it comes to know about the nationality of money borrowers. He said, among the issues is none possession of national identification cards which he said has given them hard time to get sufficient required information of borrowers and money lenders in various financial institutions in the country. He said together with other information, they obtain other customers’ information through their mobile telephone contacts registered with various mobile phone companies operating in the country or get some information from their respective areas of domicile. The CEO threw a challenge yesterday after he had opened a one day consultative workshop which his company had organized for banks executives in the country. The workshop ushered the official opening of the company’s offices was also attended by some heads of lending financial institutions. Dun and Bradstreet Credit Bureaus Limited is the first company to be licensed by the Central Bank of Tanzania (BOT) to keep records of customer money borrowers of all commercial banks and other financial institutions since the BOT established the credit in the country This is after the BOT which is the main financial regulator in the country launched a Credit Reference System (CRS) in an historic colorful ceremony which was attended by representatives of almost all financial institutions and credit bureau in October 2012. The CRS system is designed to collect and provide information on the payment record of all clients of the lending banks and other financial institutions as well as those of Savings and Credit schemes in the United Republic of Tanzania and other entities engaged regularly in the extension of credit. The company has reduced the information asymmetry between lenders and borrowers in the country since its first operation in October last year thereby creating transparent and efficient credit information systems. He said D&B Credit Bureaus provide risk management capabilities to lenders, facilitate information-based lending, accelerate their speed of making decisions, provide easy & quick access to finance to eligible companies & individuals thereby augmenting growth opportunities for the entire economy. He said adding that, the firm work closely with central bank, commercial banks, financial institutions, insurance companies, economic development boards & various government entities and specialize in building robust credit information infrastructure in emerging markets. Experience has shown that, problems related to data accuracy are the subjects of numerous complaints and litigation around the world and, as a result, have had significant impact on the development of credit reference systems. In view of the need to have a State-of-the-Art credit reference system in Tanzania, the BOT has engaged M/s Credit info International to assist in setting up a credit reference databank, the vendor started work in October 2011. Pilot testing of the system began in June 2012 and so far about 26 banks have already joined the testing environment out of which 9 banks have successfully uploaded data into the system. According to Mr. Miguel Llenas, C.E.O of Dun & Bradstreet Credit Bureaus Tanzania Limited, aims at to build the most comprehensive Credit Bureau that will play a vital role in boosting Tanzania’s economy and financial soundness. To this end, the company has designed a focus specifically on D&B’s role to help banks and the financial institutions in Tanzania to improve the assessment of credit/loan applications with a view to ensure that they make only the most informed business decisions that reduces NPL ratios so as to create an easily identifiable pool of credit-worthy customers.” Also, speaking further about the consultative workshop, General Manager Dun & Bradstreet Credit Bureau Tanzania Limited, Mr. Adebowale Atobatele said, his company is considering banks and the financial institutions in Tanzania to be their partners. The last week’s workshop provided an opportunity for the stakeholders who met and listened to meet with, and listen to their partners in Tanzania. “We want to serve them and it is important for us to understand the specific challenges they encounter in their business of creating risk assets”. He said.