Updates on the BAP-Credit Bureau

June 29, 2011 By Leave a Comment

Topper CoronelMr. Leonilo ‘Topper’ Coronel, Managing Director of the Bankers Association of the Philippines Credit Bureau (BAP-CB), presented the private credit bureau’s latest changes and activities to participants of the 2011 RBAP-MABS National Roundtable last May 23-24 in Manila. He shared the latest developments in the effort of BAP-CB and a consortium of microfinance institutions’ (MFIs) to build a responsive credit information system for the microfinance sector. (see Philippine Star article)

He reported the over 60% growth in the number of participating rural banks from 28 to 46 in May 2011, attributing this increase to the BAP-CB’s efforts to reach out to rural bank federations in the country, and the assistance of the USAID-supported RBAP-MABS Program.

He also underscored the enhancements in the bureau’s Negative File Information System (NFIS) particularly its accessibility via the Internet, which allows the credit bureau to automatically process requests on a daily basis, even on non-working days. In addition, BAP-CB provides its participating institutions with (1) one-on-one training for their key officers, (2) data management modules, and (3) other data mining applications such as SNIP (or Similar Names Inquired Previously). Finally, the inquiry fee has been reduced by half – the bureau now charges P5.00 per inquiry versus P10.00 in the past. [Read more...]

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New Developments in the BAP-Credit Bureau

February 18, 2011 By 1 Comment

By: MABS Microfinance Specialist Bernabe Bunao Jr.

One of the keys to successful lending operations is to properly screen out clients who are over-indebted or with poor credit histories. This is becoming increasingly important as the sector becomes more competitive than ever before.  A useful tool to manage and mitigate these inherent risks is through the practice of credit sharing among lenders.  Rural banks are fortunate to have the opportunity to make use of private credit bureaus such as the Bankers Association of the Philippines – Credit Bureau (BAP-CB).
BAP-Credit Bureau offers functional online credit information services that pave the way for quick credit decisions. The technology is homegrown as the tool is in response to rural banks’ requirements that are comprehensive and integrated with a secure database.

BAP-CB_BAP-CB screenshotOne of the keys to successful lending operations is to properly screen out clients who are over-indebted or with poor credit histories. This is becoming increasingly important as the sector becomes more competitive than ever before.  A useful tool to manage and mitigate these inherent risks is through the practice of credit sharing among lenders.  Rural banks are fortunate to have the opportunity to make use of private credit bureaus such as the Bankers Association of the Philippines – Credit Bureau (BAP-CB).

BAP-Credit Bureau offers functional online credit information services that pave the way for quick credit decisions. The technology is homegrown as the tool is in response to rural banks’ requirements that are comprehensive and integrated with a secure database. [Read more...]

Filed Under: MABS Tips Tagged With: ,

Commercial banks offer credit bureau services to rural banks

January 12, 2011 By Leave a Comment
MANILA, Philippines – In the absence of the national credit information system as mandated by the Credit Information System Act (CISA), rural banks are encouraged to avail of the credit information services offered by the Bankers Association of the Philippines-Credit Bureau Inc. (BAP-CB).
The CISA was passed into law in October 2008 and the implementing rules and regulations (IRR) were finalized the following year.
Under the law, the credit information body is mandated to receive and consolidate basic credit data and to act as a central registry of credit information. It will provide access to reliable standardized information on the credit history and financial condition of borrowers.
However, it all remains in paper as the Securities and Exchange Commission (SEC), designated by the law as lead government agency, has not taken any action since the approval of the IRR.

Philippine Star – In the absence of the national credit information system as mandated by the Credit Information System Act (CISA), rural banks are encouraged to avail of the credit information services offered by the Bankers Association of the Philippines-Credit Bureau Inc. (BAP-CB).

The CISA was passed into law in October 2008 and the implementing rules and regulations (IRR) were finalized the following year.

Under the law, the credit information body is mandated to receive and consolidate basic credit data and to act as a central registry of credit information. It will provide access to reliable standardized information on the credit history and financial condition of borrowers.

However, it all remains in paper as the Securities and Exchange Commission (SEC), designated by the law as lead government agency, has not taken any action since the approval of the IRR.

Read more

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The Benefits of the BAP-Credit Bureau for Rural Banks

January 7, 2011 By 3 Comments
Getting accurate, timely and objective credit information in a cost efficient way is one of the serious challenges that rural banks with microfinance operations face in making credit decisions.  The long-standing practice of pre-screening a loan application through field information gathering is costly and slow, and delays loan approval process. It is anticipated that a national credit information system mandated by the Credit Information System Act (or CISA) will help in addressing this challenge. However, getting the system up and running may still take sometime.
Meanwhile, rural banks can turn to the existing credit information services offered by the Bankers Association of the Philippines – Credit Bureau Inc. (BAP-CB). During the 53rd RBAP Charter Symposium on October 14-15, 2010 BAP-CB officer Manuel Batallones, reiterated the strong interest of the BAP-CB to support  rural banks’ credit information needs as their way of supporting the rural banks and especially the microfinance sector.  BAP-CB has also reduced the fee for inquiry from P11 to P5.60 and is waiving the fee to join the system. Currently, over 20 rural banks are subscribing to the BAP-Credit Bureau.
With strong support from the USAID-supported RBAP-MABS Program since its pilot testing with rural banks in Mindanao, the online services of the BAP Credit Bureau paves the way for an effective credit information system.
BAP Credit Bureau

BAP-CB officer Manuel Batallones

Getting accurate, timely and objective credit information in a cost efficient way is one of the serious challenges that rural banks with microfinance operations face in making credit decisions.  The long-standing practice of pre-screening a loan application through field information gathering is costly and slow, and delays loan approval process. It is anticipated that a national credit information system mandated by the Credit Information System Act (or CISA) will help in addressing this challenge. However, getting the system up and running may still take sometime.

Meanwhile, rural banks can turn to the existing credit information services offered by the Bankers Association of the Philippines – Credit Bureau Inc. (BAP-CB). During the 53rd RBAP Charter Symposium on October 14-15, 2010 BAP-CB officer Manuel Batallones, reiterated the strong interest of the BAP-CB to support  rural banks’ credit information needs as their way of supporting the rural banks and especially the microfinance sector.  BAP-CB has also reduced the fee for inquiry from P11 to P5.60 and is waiving the fee to join the system. Currently, over 20 rural banks are subscribing to the BAP-Credit Bureau.

With strong support from the USAID-supported RBAP-MABS Program since its pilot testing with rural banks in Mindanao, the online services of the BAP Credit Bureau paves the way for an effective credit information system.

[Read more...]

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Philippines jumps up to Rank 2 in microfinance worldwide, still #1 in Asia

October 13, 2010 By Leave a Comment
The Philippines ranked second in the world and first in Asia in terms of “Overall Microfinance Business Environment” in the 2010 study conducted by the Economist Intelligence Unit (EIU), the business information arm of The Economist Group that publishes the Economist.  Climbing up from third place last year, the Philippines overtook Bolivia, becoming the only country after Peru.
The study conducted by the EIU reviewed 54 countries and evaluated each country’s microfinance business environment in terms of its regulatory framework, investment climate and level of institutional development.  Interviews with microfinance industry leaders and stakeholders along with secondary information were analyzed to come up with the rankings.
According to the study, the Philippines is currently the global leader in regulatory framework.  It is also the top Asian country in terms of institutional development, and second behind India in investment climate.
According to the EIU, one of the key factors that brought about the rise in ranking was the recent approval of the Bangko Sentral ng Pilipinas (BSP) for rural and thrift banks to sell authorized micro-insurance products. In addition, the BSP also issued a circular that sets the rules for accrediting microfinance rating agencies, which, according to the EIU, is a move to encourage local microfinance institutions to be externally rated.  Also in 2010, the BSP issued rules on the extension of housing microfinance and eased requirements for agricultural microfinance. The entry of major commercial banks and telecommunications companies into microfinance is also seen as a contributory factor towards the advancement of the sector. Furthermore, the signing of the Credit Information Systems Act (CISA) and the approval of its Implementing Rules and Regulations are also positive developments.
However, rural banks, which are among the key proponents of microfinance in the Philippines, believe that the Credit Bureau system in the country still has a long way to go. “We believe that the slow implementation of the Credit Information System Act (CISA) is among the key factors hindering the Philippines from having the best microfinance business environment in the world,” Rural Bankers Association of the Philippines (RBAP) President Ma. Corazon Llamzon-Miller said.
The CISA, which mandates all lending institutions to submit both positive and negative credit data, allows for better and easier credit information sharing among financial institutions for more secure and credible lending. Realizing its importance to rural banks, RBAP, along with its USAID-supported Microenterprise Access to Banking Services (MABS) program, has been advocating access to credit bureaus for rural banks even before the passage of the Credit Information System Act in 2008.
According to Ms. Miller, “RBAP will continue push for a faster implementation of the CISA through its representation at the credit information corporation board. We believe that with the full implementation of the CISA, the Philippines will indeed rank number #1 in microfinance business environment in the world.” Meanwhile, the rural banks are using the Bankers Association of the Philippines (BAP) Credit Bureau for each credit investigation needs.
The EIU study was financed by the Multilateral Investment Fund – Inter-American Development Bank Group, CAF (the Andean Development Corporation) and the International Finance Corporation (IFC).

The Philippines ranked second in the world and first in Asia in terms of “Overall Microfinance Business Environment” in the 2010 study conducted by the Economist Intelligence Unit (EIU), the business information arm of The Economist Group that publishes the Economist.  Climbing up from third place last year, the Philippines overtook Bolivia, becoming the only country after Peru.

The study conducted by the EIU reviewed 54 countries and evaluated each country’s microfinance business environment in terms of its regulatory framework, investment climate and level of institutional development.  Interviews with microfinance industry leaders and stakeholders along with secondary information were analyzed to come up with the rankings.

According to the study, the Philippines is currently the global leader in regulatory framework.  It is also the top Asian country in terms of institutional development, and second behind India in investment climate.

[Read more...]

Filed Under: MABS Reports Tagged With: , , ,
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