Government is moving to set up a credit reporting industry that would allow creditors to access reliable information about potential debtors.
At Thursday’s sitting of the National Assembly, Finance Minister Dr Ashni Singh tabled the Credit Reporting Bill 2009, which aims at enabling “more reliable, competitive and responsible credit lending” while protecting the rights of borrowers.
According to the Explanatory Memorandum of the bill, it would provide for the licensing of credit bureaus by the Bank of Guyana. The bill proposes that “only a locally incorporated company limited by shares, whose activities are restricted by its articles of incorporation to carrying on the business of a credit bureau would be eligible to conduct the business of a credit bureau.”
It sets out the licensing procedures and establishes specific criteria governing the form and content of an application for a licence and the factors to be considered by the bank when evaluation an application for a licence. It also provides “for the circumstances in which a license could be revoked and the procedure for giving the licensee an opportunity to respond prior to revocation.”
The supervision of the credit bureau by the bank would be legislated and the bill details “enforcement measures” which may be adopted by the bank.” Provision is also made “for the conduct of an annual audit and compliance interview and for the submission of this report to the bank and shareholders.”
The bill deals with the principles of credit reporting. It provides for sharing of credit information by credit information providers and specifies who is considered a credit information provider, the standard of reliability of the information to be satisfied prior to transmission to the credit bureau and the prohibition of the sharing of such data without the consent of the consumer.
The purposes for which consumer information may be provided and to whom it may be provided to are specified as well. Special provisions to safeguard the confidentially and integrity of the information during transmission, transcription and storage are also included.
Additionally, the bill provides for the administration and responsibility of a credit bureau. Directors of the bureau would be required to ensure that its activities are conducted in full compliance with the law. All the permissible activities and the responsibilities of the credit bureau are clearly identified along with the capital requirement. Provision is also made in the bill for the suspension and liquidation of a credit bureau and how the information collected should be dealt with in these circumstances.
The rights of the consumer are identified as well, including the right to receive copies of all the information in the consumer’s file at the credit bureau, all the sources of such information and a list of the users who have accessed it during the sixth month period prior to the provision of the information. The consumer can also challenge the information if it is illegal, erroneous, or outdated and these challenges will have to be investigated by the credit bureau. Provision is made for the modification or deletion of the information in the file, depending on the outcome of the investigation. There is also a procedure for the resolution of disputes.
The unauthorized disclosure of credit information, the obtaining of information under false pretences and other breaches of the provisions of the bill are offences.
Further, the bank would have the “authority to prescribe regulations and issue such notices or guidelines including the form of an application, for and of a licence, the scope and procedure for the conduct of the annual audit and compliance review, the books, accounts and records to be kept by the credit bureau, the level of data adequacy” and other matters required for carrying out the purposes of the bill.
