If you’ve ever borrowed from a financial institution, paid a utility bill in your name or taken out an item on hire purchase then it’s fair to assume that a credit report has been generated for you.

A credit report is essentially a document that contains the history of your borrowing relationships with creditors over a period of time. In Jamaica that information is collated and stored by credit bureaus. Under the Credit Reporting Act, 2010 credit information providers which are banks, financial institutions, micro-credit entities and even hire purchase companies share information with credit bureaus.

According to chief prudential officer at the Bank of Jamaica (BOJ) Jide Lewis, “It’s not mandatory but these financial institutions see it as beneficial to their own businesses.”

Lewis was speaking on a recent edition of the B OJ Centrally Speaking programme.

He explained that the credit report helps creditors to make more informed decisions about borrowers’ habits before they lend.

“When you look at a credit report what it’s gonna tell you is how much you borrowed, from whom you borrowed and whether you’ve been repaying that obligation on time and whether you’ve been paying the amounts you are contracted to pay,” said Lewis.

But with the sensitive nature of the information in the credit report, Lewis explained that credit bureaus have a mandate to guard the information they receive with the strictest confidentiality.

“Credit bureaus are supervised by the Bank of Jamaica, they have a license and part of that license gives them an obligation to ensure that they are storing personal information in a very secure manner. Also, institutions that are authorised to get credit reports cannot get the report unless they have the consent of the borrower,” Lewis continued.

He said the lending institution is only allowed to use the information they receive for the purpose it was requested and noted that any other use of the data would be a breach. Notably, the credit bureau does not need consent to gather credit information.

One benefit of the credit report is that people with good credit collateral tend to get good credit terms.

“In some ways they are saying if you were good with credit in the past you will be good in the future. We all make mistakes so everything on your credit report may not be perfect but the decision is not only on whether they should lend, it’s also about what interest rate they should lend you at, what period the loan facility should be extended for and that institution now has a business decision to make,” Lewis said.

He explained that the report will likely have information that can go back five-10 years depending on the credit bureau and their databases. There are three licensed credit bureaus in Jamaica: CRIF Information Bureau Jamaica, Creditinfo Jamaica and Credit Information Services. Jamaicans can access their credit report at least once each year for free. Lewis encouraged consumers to take advantage of the free report and use the opportunity to ensure that the information in the report is accurate.