Philippines OKs first 6 credit bureaus

MANILA, Philippines - Eight years since the law's enactment, the Philippines finally gave its first go-ahead for six credit bureaus to start operations as early as next year.

"There were more than six that went to us during the briefing, but only six actually submitted formal application for accreditation," said Credit Information Corp. (CIC) President Jaime Garchitorena told reporters on Monday. 

"The CIC Board determined they are capable to deliver their business plans," he said in a briefing in Makati City. 

Five of the six of credit bureaus are foreign companies namely Compuscan of South Africa, Dun and Bradstreet (US), Crif (Italy), TransUnion Philippines (local office of US firm) and Credit Bureau Singapore.

Local firm CIBI Information Inc. was also accredited.

Garchitorena said bureaus may start operations as soon as they become incorporated, but actual offering of products may not happen until 2017.

"The complete and substantial collection of data, we may finish that closer to end of 2016 or early 2017," he said.

"However, as soon as they become incorporated companies, they will be able to do business in the Philippines to make the public become aware of their business," Garchitorena explained.

Signed in 2008, Republic Act 9510 mandated the creation of CIC to facilitate the collection of public credit data and information.

The aim is to assist corporations such as banks to garner relevant data to help gauge clients' credit worthiness for loans.

Specifically, Garchitorena said having a credit repository will assist small- and medium- enterprises (SMEs) secure much-needed financing.

Securities and Exchange Commission Chair Teresita Herbosa said around 80 percent of local firms are SMEs which lack financial standing to qualify for bank loans.

"Very little of large amounts of capital in the financial system are flowing to the SMEs," said Julius Caesar Parrenas, coordinator at Asia-Pacific Financial Forum.

The forum is a member of the Financial Infrastructure Development Network, an initiative launched during the meeting of Asia-Pacific Economic Cooperation in Manila last November.

FIDN aims to strengthen credit access for SMEs.

"SMEs would greatly help in boosting economic growth if they will be supported," he added.