Co-op bureau to record credit history
KATHMANDU, SEP 21 -
National Cooperatives Bank (NCB) has established Cooperatives Credit Information Bureau (CCIB) to keep records of the credit history of borrowers from cooperatives in a bid to discourage a single member from taking loans from multiple cooperatives.
NCB made the move with cooperatives facing greater risks due to a single person joining different cooperatives and getting loans from them. NCB said this would address the risk of possible non-recovery of such loans.
Currently, the Credit Information Bureau (CIB) has been keeping records of the credit history of borrowers from banks and financial institutions. However, cooperatives have no access to the credit history of their prospective borrowers who may be members of multiple cooperatives.
Cooperatives have lent Rs 133 billion as of the last fiscal year while their deposit collection amounts to Rs 125 billion.
NCB’s deputy general manager Badri Kumar Guragain said the newly formed CCIB could help cooperatives to know about the credit worthiness of their borrowers. “This could protect cooperatives from defaulters thereby protecting the money of depositors,” he said.
NCB established CCIB as per the decision of its eighth annual general meeting after taking the approval of the Department of Cooperatives. Nepal Rastra Bank has supported the move too, said Guragain.
According to NCB, all the members of the bank will be forced to obtain information from the CCIB while providing loans of more than Rs 100,000. It will also keep a separate database of loanees who have not repaid loans regularly and those who have defaulted. The CCIB will charge Rs 100 for information about non-business credit and Rs 125 for business credit.
Member cooperatives will have to keep details of loans and loanees including names, address, citizenship number, family details, name of guarantor, details of loans and names of the cooperatives that have sought information about the potential borrower.
Around 5,000 cooperatives are now members of NCB, half of which are savings and credit cooperatives. Guragain said they have requested the Department of Cooperatives to bring other cooperatives under the system in addition to NCB member cooperatives.”
According to NCB, they have started installing software at its member cooperatives to enable them to get credit information from the CCIB. “The system provides access to personal information only after verification of the IP address,” said Guragain.
Posted on: 2012-09-21 08:33