Credit registry updates database for loan review

The country’s central credit registry has updated its database to reflect the relevant information needed for loan assessment amid the coronavirus pandemic.

Credit Information Corp. (CIC) President and CEO Jaime Casto Jose P. Garchitorena said that lenders should be able to take into consideration the current environment when determining the creditworthiness of borrowers.

Garchitorena said it was important to be able to carefully evaluate the credit history of borrowers and factoring in their payment behavior even the prior years.

“Since depending on the lender and the type of loan applied for, the review of credit history can go back to as far as three years,” he said.

“Any lender then who uses the CIC Credit Report will be able to properly reference the period of ECQ [enhanced community quarantine] and understand that non-payment or partial payment was likely due to the extreme environmental issues at the time,” Garchitorena added.

According to him, doing so could clarify that a borrower—who might be a micro-scale, small-scale and medium-scale enterprise owner—has a reasonable excuse for non-payment at the moment, he added.

In April, CIC told lenders to be more considerate during the lockdown that began last March 17, advising them not to tag missed payments or partial payments of loans as default or delinquent right away given the current situation.

Garchitorena said that nonpayment of a borrower during ECQ should not be basis of one’s creditworthiness, encouraging lenders to analyze historical data as well to see the whole picture.

he added the credit registry ensures that the data submitted by financial institutions are accurate, which means it underwent fair review and assessment of credit history and financial condition of the borrowers. The CIC said that as of March its database comprises 11.3 million unique individuals and 83,000 companies with 73.5 million contract data.

“What the CIC does is fill the information gap,” Garchitorena quipped.

The CIC currently has 483 members comprising credit card issuers, universal and commercial banks, thrift banks, rural banks, cooperatives and cooperative banks, savings and loan associations, private lending institutions, private leasing and financing companies, microfinance institutions, government-owned and controlled corporations with lending facilities and insurance companies.