Amendments proposed to enable more consumer data for licensed credit bureau

A new bill proposed by the APNU+AFC administration will see credit information providers such as banks, companies licensed to conduct financial business, and other entities approved by the Bank of Guyana, being authorised to provide credit information to a licensed credit bureau without the consent of the consumer.

“This Bill is based on the experience of CREDITINFO Guyana, and draws upon best practices of other jurisdictions as well as those developed by the International Finance Corporation, and the proposed amendments are expected to contribute to an improved credit reporting framework,” the explanatory memorandum of the Credit Reporting (Amendment) Bill 2015 says. The Bill is in the name of Minister of Finance Winston Jordan.

“Credit information providers are required to have the consent from consumers prior to submitting a request to a credit bureau with the view of obtaining credit information. They are authorised to upload credit information to a licensed credit bureau without the consent of the consumer,” it says.

A credit bureau is an organization that collects credit information from lenders and information from other sources on a consumer, processes that information and uses it to create comprehensive credit reports and other value added services.

The Credit Reporting Act 2010 identifies credit information providers as a bank licensed under the Financial Institutions Act 1995; a company other than a bank licensed to conduct financial business under the Financial Institutions Act 1995; and any other entity the Bank of Guyana may designate as a credit information provider by notice published in the Gazette and two daily newspapers of general circulation in Guyana.

The Bill amends Section 11 of the Principal Act by inserting a new subsection which says that “credit information providers referred to in section 12 (2) shall submit a request of a credit bureau for a credit report about a consumer before granting credit facilities or renewing credit facilities to a consumer in order to carry out an evaluation on credit risk.”

It also inserts a new subsection in Section 12 of the Principal Act which states that the credit information providers “shall share credit information on all persons to whom they extend credit facilities in their portfolio to a credit bureau.”

It amends subsection 7 of Section 12 so that it reads “A credit bureau may collect data or information from public sources and these public sources shall share the same to a credit bureau.” Public sources include data available to the general public; court judgments; immovable property registers; and company registries. An amendment is proposed to include utility companies in this list.

Further, an amendment is proposed to Section 13 of the Principal Act to remove the word “not” from subsection (1) so it would now read that “A credit information provider shall share with a credit bureau data or information including electronic data or information collected on a consumer without the consumer’s prior consent.”

An amendment to subsection (2) is also proposed so that it would now read that “A credit information provider shall not submit a request to the credit bureau prior to obtaining credit information on a consumer without the consumer’s prior written consent which may be recorded in any format and where it is electronically recorded it shall be accompanied by an electronic signature.”

A proposed amendment to subsection (4) of Section 13 of the Principal Act would now see it reading “A credit information provider shall not share with a credit bureau personal information about a consumer unless the information is necessary for one or more of the credit reporting or credit risk appraisal functions or activities of the credit bureau.” The amendment will remove a clause which states that the personal information shall only be shared with the written consent of the consumer.

Two amendments are proposed to Section 14 of the Principal Act which would see two subsections being inserted.

Guyana’s first credit reporting bureau, Creditinfo Guyana, was launched in 2013. At the time it was stated that the idea behind a credit bureau is to serve as an information sharing mechanism so that lenders would be able to assess how much of a risk it is to lend to a particular person. This assessment will then determine interest rates and other costs connected to the financing.

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