HOW TO OPEN A PERSONAL

Banking is an evolving industry. New policies have been implemented by the Bank of Jamaica for opening a bank account based on a “Know Your Customer” mandate.

This mandate is a guideline that every financial institution is required to adhere to and can be followed by covering four criteria.

1 – National identification in the form of picture identification as well as your Tax Registration Number (TRN). For those who currently do not have a driver’s licence, a passport or electoral identification along with your TRN may be presented.

2 – A proof of address document in the form of a utility bill or a bank/ credit card statement specifically in your name. Address verification from a Justice of the Peace may also be used.

3 – Proof of income/ source of income document whether it be a current job letter or your last three payslips if you are paid monthly and your last six if paid fortnightly. Not currently employed but receiving money from a legitimate source? Then the financial institution would require proof of the source of funds that you would be depositing, for example, a family member sending funds through Western Union or a parent/ loved one giving you money monthly.

4 – Reference(s) from individuals not related to you would be required to complete your account opening process. The criteria for a reference in itself may vary from institution to institution but may likely be a lawyer, medical practitioner, minister of religion or Justice of the Peace.

HOW TO GET A PERSONAL

A credit card is a lending tool that offers the cardholder a line of credit issued by a lending institution.

It allows the cardholder to pay for goods, services and/or receive cash advances based on the cardholder’s promise to repay the loan in the future.

When a credit card is used, the bank pays on behalf of the cardholder who is expected to pay at a later date. A credit card may be taken in your personal capacity or for your business.

For a bank to issue you a credit card, an assessment of your financial standing is required.

The limit allocated to you is determined by your existing salary and your monthly responsibilities/expenses.

Presentation of your TRN and picture identification, your proof of income document (last three payslips or a current job letter), your proof of address and a signed credit reporting consent form (you giving the bank your approval for the bank to obtain and assess your credit history report) to the bank representative will allow them to assess your financial standing and further determine whether or not you have been approved for the card.

WHAT IS A CREDIT REPORT?

Like a broken record, one cannot question the possibility of borrowing from a financial institution without hearing about a credit report check.

Financial institutions hold the responsibility of properly advising a customer of the requirements of a loan and based on those requirements, the possibility of one being approved for a loan. So what is this credit report banks keep going on about?

A credit report is a history of any loan taken in one’s name. Financial institutions report customer lending information to two credit bureaus operating in Jamaica; Creditinfo Jamaica Limited and Crif Information Bureau Jamaica.

These credit reports outline the type of loan facility and the purpose of the loan, the loan amount, the start and end date, required monthly payment, outstanding balances as at that month and in some cases even the interest rate of the loan. Most importantly, these reports hold a record of any missed/past due payments that have occurred, any written off balances, repossessed facilities and loans closed in advance. Credit cards are also reported on one’s credit report.

Some of the other lending institutions also report customer information to the credit bureaus. Financial institutions require your approval to attain your credit report and once approval has been given, they can use such report to assess you financially and determine the type of customer you were in the past, present, and undoubtedly as a guide to your creditability in the future.