Third credit bureau being considered
THE Bank of Jamaica (BOJ) may issue more licences for credit bureaus.
"We currently have one application, and we have indications of others with intent," said Gayon Hosin, BOJ's deputy governor of financial Institutions, supervisory division.
So far, two institutions have received licence from the central bank — CreditInfo and CRIF NM Credit Assure Limited. At least one is expected to begin operations before the year ends.
The application review process has no strict timeline, but is structured to accommodate additional information, according to Brian Wynter, the central bank's governor.
He said that rather than giving an outright refusal of an application, interested parties will have to restart the application process, although that is not ideal.
But considering the fact that credit bureaus are new to the country, the BOJ has taken a less strict approach.
"We should do it (reject faulty applications) but it's a new process, so we should take a generous approach," Wynter said.
The idea of setting up credit bureaus in Jamaica was first floated a decade ago.
In August 2010, Parliament passed The Credit Reporting Act to "provide for the sharing of credit information between specified bodies, the licensing of credit bureaus and for connected matters".
The law was created to "ensure that credit reporting is done through reasonable procedures that meet the needs of commerce for credit information in a manner that is fair and equitable to the consumer".
The BOJ's current approach means that more time will be taken for credit bureaus to begin operations.
"It would appear as if the regulatory body is slow, but the reviewer has to go through an application as many as three times," Wynter said.
Credit bureaus are expected to make it easier for people with good credit histories to get unsecured loans and, by making the market more efficient and transparent, promote economic growth.
Consumers are eligible to receive one free report per year, and bureaus will only be able to provide credit history information to prospective lenders with the written consent of the relevant consumer.