Philippines creates 6 credit bureaus

MANILA, Philippines - Eight years since the law’s enactment, the Philippines finally gave its first go-signal 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 applications for accreditation,” said Jaime Garchitorena, president of Credit Information Corp. (CIC).

“The CIC Board determined they are capable to deliver their business plans,” he said in a recent briefing.

Signed in 2008, RA 9510 mandated the creation of CIC to facilitate the collection of credit information from the public and corporations.

The aim is to assist companies such as banks in surveillance of credit worthiness of their clients.

Five of the six recently accredited credit bureaus are foreign firms with local partnerships namely Compuscan of South Africa, Dun and Bradstreet (US), TransUnion (US), Crif (Italy) and Credit Bureau Singapore.

Local firm CIBI Information Inc. was also given the approval to operate as a credit bureau.

Garchitorena said the bureaus may start business as soon as they become incorporated, but actual offering of products and services may not happen until early 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 (companies) become incorporated, they will be able to do business in the Philippines to make the public become aware of their business,” he explained.

The CIC, in fact, will actually organize roadshows with the bureaus by June to help them publicize their business and the products they would offer.

According to Garchitorena, bureaus will purchase credit information from the CIC for P55 per each record. They, in turn, can sell it with additional charge to their clients.

“The price is very reasonable. We estimated that even with additional value, bureaus will only sell them (credit record) between P120-P150 each,” he said.

Teresita Herbosa, chair of the Securities and Exchange Commission, said a credit repository would benefit small- and medium- enterprises (SMEs) the most.

SMEs, according to her, account for about 80 percent of Philippine firms.