Rules for credit information bureau law finally released

The SEC said the rules -- posted on its Web site two weeks ago -- for Republic Act 9510 were promulgated to address the need for a comprehensive, centralized and reliable credit information system.
It added that the rules would also:

improve the overall credit availability to micro-, small- and medium-scale enterprises,
provide credit information at the least cost to those to be covered;
ensure protection of consumer rights and ensure the protection of consumer rights; and
reduce overall credit risk, contributing to a healthier and more stable financial system.
The bureau to be created under the Credit Information and System Act is expected to provide reliable information regarding the credit standing and track record of borrowers. It will be headed by the SEC chairman.
Banks, insurance companies, credit card firms, trust entities, investment houses, non-government organizations engaged in micro-finance, government lending institutions, and cooperatives engaged in lending are covered by the law.
They are required to submit to the credit bureau information -- covering the preceding five years -- on clients which include net income, assets, expenses and other personal information.
Creditors are also required to submit an exposure profile that will contain the types of loans a client has taken, the mode of payment, remaining balance, collateral used and payment history, among others.
Negative information such as past due and defaulted loans, foreclosures, adverse court judgments relating to debts, inclusion in bouncing check checklists, among others, will also have to be disclosed.
The negative information on a borrower will remain in the credit bureau’s database for not more than three years after the debt has been paid or settled or court decision exculpating the borrower from any liability.
The bureau will update the database every quarter. It will also have access to information from government agencies, judicial and administrative tribunals, prosecutors and related offices, and state pension funds.
Submitting entities, corporations engaged in providing credit reports, ratings and similar services, data subjects, and third parties tapped by the credit bureau to consolidate the information may have access to the data.
Borrowers can dispute erroneous, incomplete, outdated or misleading information by filing a letter of complaint, which the credit bureau shall investigate and verify within five working days after receipt of the grievance.
The credit information bureau, which will be set up as a corporation with authorized capital of P500 million, will be 60% owned by the government through the SEC.


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Free Credit File search to avoid financial problems

The Information Commissioner’s Office (ICO) has recently urged consumers to ensure that their credit reference file or credit report is accurate and up-to-date.

Whilst millions of consumers will try and apply for credit in 2010, some for debt consolidation purposes and others to prop up squeezed disposal income, many will be declined when credit granters check the credit reference agency records.
The ICO has confirmed that it is essential that you make sure the information accessed by lenders is accurate. One of the items recently raised by government ministers has been the issue of duplicate credit searches on your credit file that may have an adverse affect on the credit scoring systems used by the major credit granters.
Under the Data Protection Act every citizen has rights which allow us to obtain and protect our vital financial information.
David Smith, Deputy Commissioner at the ICO, said: “Many of us will be relying on credit to get us through 2010. Out of date or wrong information in your credit file might not only stop you getting the credit you need but could have further damaging or embarrassing consequences. By checking your credit file regularly you can spot anything that’s wrong and act swiftly to correct it. “


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