From July 2021 onwards, the State Bank of Pakistan (SBP) has decided to include two years of the history of negative/overdue information of defaulter consumers/individual borrowers in the Electronic Credit Information Bureau (eCIB) reports of the SBP in line with international practices.
The eCIB report reflects negative/overdue information for consumer/individual borrowers for one year at present.
The decision was undertaken by the SBP to align its eCIB policies with international practices and to meet the Ease of Doing Business Survey (EODB) requirement of displaying at least two years of history in the eCIB reports.
The same will help in the enhancement of the credit assessment capability of the member Financial Institutions (FI) of their current and potential customers.
It is very important to note that this change will be adopted on a prospective basis and will be effective from July 2021 onwards.
Accordingly, any default, delay in payment, etc. prior to 1 July 2021 will continue to be reflected in the credit report of the customers only for one year. However, defaults, delayed payments, etc. after 1 July will be shown on the credit reports for two years.
All the member FIs are advised to inform their existing and potential customers of the contents of this policy change. They should also ensure upfront disclosures of the eCIB reporting requirement and its implication (the reflection of overdue/late payments/write off/waiver, etc.) to their current and potential customers in eCIB reports after settlement of their liabilities.
About SBP’s eCIB
The eCIB of the SBP collects and collates credit data on borrowers from its member FIs.
The financial data is then aggregated in a system, and the resulting information in the form of credit reports is made available online to the member FIs for the purpose of credit assessment, credit scoring, and credit risk management.
The major purpose of this database is to enable the FIs to know the credit history of their current and prospective customers, thus enabling them to make informed and timely lending decisions.