ACCURATE credit data on borrowers and faster loan processing have
encouraged more rural banks to tap the Bankers Association of the
Philippines' (BAP) credit bureau, according to the association of rural
banks.
In a statement posted on its Web site last March 29, the Microenterprise
Access to Banking Services (MABS) said the number of rural banks that
accessed the BAP's credit bureau significantly increased last year from
2010.
MABS reported that the number of rural banks enrolled in BAP's credit
bureau rose to 77 last year from 20 in the year before. The number of
"active users," meanwhile, totaled 51 from 13 in 2010.
It also noted that the number of inquiries done by rural banks nearly
quadrupled to 44,909 last year from 11,509 inquiries a year earlier.
BAP is the grouping of commercial and universal banks.
MABS is a program supported by the United States Agency for
International Development. It is helping the Rural Bankers Association
of the Philippines (RBAP), the association of rural banks, come up with
new financial services.
"The increase in the number of rural banks tapping the BAP's credit
bureau can be attributed to higher awareness among rural bankers of the
benefits they get from having access to a credit bureau," said RBAP
President Ian Eric S. Pama in a phone interview last Wednesday.
"Once a rural bank has access to BAP's credit bureau, it enjoys
protection against credit applicants who have bad loan records in
commercial, thrift or other rural banks because it can verify a
particular client's record," he said.
Another benefit is, the processing of loan applications becomes faster.
"Using BAP's credit bureau, a rural bank can approve or turn down a loan
application in a few hours because it would immediately know a loan
applicant's credit profile and decide from there if the loan application
should be approved or not," Mr. Pama said.
In the statement, MABS said: "One factor [for the higher number of rural
banks enrolled in BAP's credit bureau and higher number of inquiries] is
the reduced fee to both enroll and access the system."
Rural banks may now enroll in BAP's credit bureau for free and pay P5
per credit inquiry.
Mr. Pama agreed and added that BAP's only requirement for rural banks
and other institutions accessing its credit bureau is the monthly
updating of their data or negative file information system (NFIS).
The NFIS is a record of commercial, thrift and rural banks' delinquent
borrowers.
MABS also pointed out the credit bureau is one of the "important tools
that could improve the analysis of potential clients' credit histories
and assist in better managing multiple borrowings and over-indebtedness."
For his part, Manuel R. Batallones, manager of BAP's credit bureau, in
the statement said delinquent loan borrowers are "flagged."
"...[R]ural banks naturally benefit from sharing these accounts as a way
to improve their loan collection efforts," Mr. Batallones said.
The BAP's credit bureau and the recently launched Microfinance Data
Sharing System -- a credit bureau for institutions practicing
microfinance -- are the only two credit bureaus operating in the country
at present.
The government has yet to launch the central credit information bureau
created through Republic Act No. 9510 or the Credit Information System
Act of 2008. -- ARRG
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CARLOS ANI - International Microfinance Consultant - SEEDFINANCE Corporation Chairman
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