MAKATI CITY, 04 September 2020 – Credit Information Corporation (CIC), the state-run credit registry and repository of credit information, underscored anew its commitment to deliver improved results for the Philippines in terms of access to credit metrics, even as the World Bank suspends the publication of its Doing Business 2021 report in August.
The World Bank’s survey measures 12 business regulatory areas, 10 of which are used to estimate Ease of Doing Business (EODB) scores, namely: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, and resolving insolvency.
In the 2020 report published in October 2019, the Philippines moved 29 notches higher than its 124th spot in the previous year, placing it in the 95th rank among 190 economies.
“While the country’s ranking in the getting credit indicator last year was marked up by 52 notches from 184 to 132, the results on the depth of credit information did not reflect the true statistics of the CIC, giving zero scores in all aspects of the credit registry,” CIC President and CEO Jaime Casto Jose Garchitorena said.
He was referring to the indicators set by the World Bank in the depth of credit information index for the country’s credit registry and credit bureaus such as the distribution of positive and negative credit data on both individuals and firms, the availability of at least two years’ historical credit data, the borrowers’ right to access their data, and financial institutions’ access to borrower’s credit information online.
“The Credit Information System Act (CISA) itself already addresses four of these indicators as it clearly outlines who shall have access to basic credit data from the CIC: our submitting entities, special accessing entities (SAEs), and of course, the data subjects themselves,” the CIC PCEO explained.
Garchitorena added that the CIC is hopeful with World Bank’s decision to conduct a systematic review and assessment of data changes in previous reports.
In 2018, the Philippine government led by the Department of Trade and Industry (DTI) and Department of Finance (DOF) officially protested the World Bank Doing Business results as “grossly inaccurate.”
Beyond the Getting Credit metrics, the PCEO cited the various milestones of the CIC which are expected to contribute to the improvement of the country’s competitiveness ranking. These include the CIC Credit Reports being made available to the public, the establishment of the Online Dispute Resolution Process (ODRP), and the deployment of the Primary ID (PID) Number Tagging which allowed credit data submission of borrowers who do not have TIN, SSS, or GSIS numbers to be loaded to the CIC database.
“Because the system now accommodates submissions with no primary IDs and accepts UMID and driver’s license, an additional six million borrower records were loaded in less than one month, which would have been previously rejected by our database. This brings the CIC’s data set of unique individuals to 18.2 million or almost 26% of the country’s adult population as of August 2020,” Garchitorena continued.
In addition, the credit registry database contains 80.4 million contracts, 58.9 million of which are installment transactions. The CIC PCEO believes that this is significant both to lenders and borrowers: “This means that the average Filipino doesn’t have a credit card but has installment contract—whether it’s monthly, weekly, or sometimes, daily—with microfinance lenders, cooperatives, or other covered financial institutions. And the CIC now has 519 entities submitting credit data to it from various sectors in the financial system.”
Garchitorena also acknowledged the CIC’s SAEs namely, CIBI Information, Inc., CRIF Philippines, and TransUnion Information Solutions Philippines which provide credit scores and other value-added products and services.
“The CIC—together with its SAEs—remains committed to the fulfillment of its goal to democratize credit information for the benefit of both the Filipino borrower and the lender,” the PCEO ended.