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Initially planned to be launched in Q1 2021
CRIB General Manager Nandi Anthony[/caption]
A new Credit Bureau System (CBS) with the capacity to update credit data on a daily basis, which is being tested by the Credit Information Bureau of Sri Lanka (CRIB) and was aimed to be launched by the first quarter of 2021, has been postponed to the fourth quarter, The Sunday Morning Business learns.
Speaking to us, CRIB General Manager Nandi Anthony stated that according to the revised plan, the launch of the CBS is now targeted to be launched by the fourth quarter of 2021. “There have been some unavoidable delays, so it is planned to be launched by the last quarter of 2021,” Anthony said.
According to him, the CBS would be a state-of-the-art system with advanced features and it is currently at the user acceptance testing (UAT) stage. The new system, once implemented, will replace the existing CBS which has been in use since 2008. The need for a new system arose due to the limitations of the existing system and the need to introduce advanced products and features in keeping with developed credit markets.
Accordingly, the new system would be able to collect more data including non-traditional data such as telco, utilities, and insurance data. Faster processing speed, higher capacity, storage, and advanced products and features are some of the key benefits that are expected from the new system.
“For example, the current system is processing 10 million records per month; the new system is capable of doing that in a day. New products such as alerts and new features such as an advanced business intelligence (BI) tool, capable of better analytics, will also be available with this new system,” he added.
According to the CRIB, following the installation of the new system this year, customers who make a loan payment mid-month will not have to wait until the month-end for their credit record to be updated, as the new system would be capable of updating even on a daily basis.
The CRIB recently introduced a credit score called the “CRIB Score” to its member lending institutions and the general public. The CRIB Score is expected to revolutionise the financial services industry, with a range of benefits to borrowers, lenders, and even regulators. This credit score initiative will also enhance the Ease of Doing Business Index of our country, and help improve and maintain the stability of the financial system of our economy.
The CRIB Score is a number between 250 and 900, providing an accurate and consistent insight to the creditworthiness and risk level attached to a borrower. The scores are generated by feeding the credit data of borrowers to an algorithm.
“The score is dynamic and it can be improved. Borrowers can negotiate better credit terms with their score and even use it as reputational collateral. Not everybody will have traditional collateral such as land and buildings. Even people who have never borrowed will be able to apply for a loan once non-traditional data is collected and fed to the scoring algorithm,” he noted.
The score is also expected to enhance the credit and risk evaluation processes of lending institutions, providing faster access to credit, whilst the score can also act as an early warning tool that can be used by regulators when monitoring the financial health of lending institutions.
Anthony stated that the CRIB does not blacklist any borrower, adding that it simply provides credit data to facilitate credit. He stated the CRIB does not provide any lending decision or limit through their reports and that the lending decision is entirely the responsibility of the lending institution.
“If the overall default rates of the country were at 5%, then this means that 95% of the borrowers would have enjoyed, benefitted, and serviced their credit comfortably,” he noted.
The CRIB is the first credit bureau in the South Asian region established 30 years ago by the Credit Information Bureau of Sri Lanka Act No. 18 of 1990, as amended by Acts No. 8 of 1995 and No. 42 of 2008.