First Credit Referencing Bureau Launched

The first credit referencing bureau XDSDATA Ghana Limited has been officially launched in Accra Ghana on the theme, “Economic Empowerment through Credit Referencing.”

The credit referencing covers the collecting, collating and maintaining of demographic and credit information on individuals and businesses on one hand and sharing this information with relevant parties especially credit providers on the other hand.

Delivering the keynote address, Mr Dela Selormey, Head of Banking Supervision of Bank of Ghana who spoke on behalf of the Governor attested to the fact that, to promote the orderly development of a credible credit reporting system in Ghana, Parliament enacted the Credit Reporting Act 2007 (Act 726). This he noted, seeks to facilitate smooth credit information sharing among credit providers within the monitory policies.

Mr Selormey acknowledged the fact that in the world of Information Communication Technology, it is prudent for an establishment like XDSDATA to act as the hub of information to facilitate the financial transaction among the various stakeholders within the financial and non-financial institutions the country.

“A credit bureau system is primarily to bridge this information asymmetry between lenders and borrowers,” he reiterated The head of banking supervision added that this transaction will help borrowers to maintain a good credit history to enable them benefit from lower borrowing costs which will further encourage repayment of loans on time, eventually resulting in lower industry default rate for lending institutions.

Mr George Ahiafor, the Managing Director of XDSDATA Ghana, assured creditors that subscribing to XDSDTATA’s referencing system will enable them assess borrower’s settlement risk objectively on their credit payment history.

“What this means is that borrowings at high risk are controlled and the market is opened for new low risk borrowers. On the other hand, borrowers will also have better access to credit, negotiate the interest rates they pay on their loans and be more responsible in their payment behaviour to ensure that they maintain good credit history,” he explained.

The MD further revealed that the information held by the credit reference bureau is invaluable to help identify fraudulent behaviour at the time of application before any loss is incurred. In the same vein, a functioning crediting system enables individuals and entities to accumulate a credit history that can be taken into consideration in lending decisions on. This track record in effect acts as personal collateral in accessing credit.

In related development, Mr Vivian Pather, Managing Director of XDSDATA South African was hopeful that the bureau will serve its intended purpose by enhancing the opportunity of Small And Medium Enterprises (SMEs) and people in the informal sector to access credit, since the growth of the country’s economy hinges on the success of its SMEs.

The financiers of the Bureau, the International Finance Co-operation (IFC), the Swiss Embassy and Databank together expressed their hope that the Credit Reference Bureau will have a positive and significant socio-economic impact in the country’s economic development.

Source: ISD (Abdul-Jalil Yakubu & Richard Quarshie)