Credit Bureau to be functional soon.
November 29th, 2006 Ogbuotobo Chuks || chuks@stockmarketnigeria.com
Ogbuotobo Chuks
Based on an agreement of a consortium of 7 Nigerian banks and mobile telecommunications giant, MTN, a credit bureau will become functional in Nigeria by the end of March, 2007.
The financial institutions involved in this project include First Bank Plc, Guaranty Trust Bank Plc, First City Monument Bank Plc, Diamond Bank Plc, Standard Chartered Bank Limited, Stanbic Bank Limited and United Bank for Africa Plc.
A credit bureau is a company that provides credit information on individual borrowers on demand. This in turn assists lenders to ascertain the level of credit worthiness of such a person. In other words, the ability to pay back the loan before determining to approve the loan.
This service is coming at a time whereby the Nigerian economy is experiencing a boost in the use of the credit card payment system. By establishing a credit bureau, issuance of credit cards would be easy and based on actual facts instead of extrapolation.
The bureau is to be 60% owned by the Nigerian consortium, while the remaining 40% is to be held by foreign technical partners.
Only last week, Ecobank Nigeria Plc pioneered the introduction of the first naira credit card. It is expected that United Bank for Africa (UBA) will follow suit before the end of December, 2006.
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