SBP issues rules for licensed credit bureaus

KARACHI: The State Bank of Pakistan (SBP) on Wednesday issued guidelines that would enable licensed credit bureaus to address their customers’ complaints in a timely and fair manner, a circular said.

An effective dispute resolution mechanism at credit bureaus (CB) provides its customers, an opportunity to resolve their disputes and complaints in a timely manner, which resultantly strengthens their confidence regarding the credibility of their credit information, it said.

The customers’ disputes and complaints data helps the credit bureaus in highlighting the deficiencies in their existing system and procedures, and other reporting issues originating from the data submitted through member financial institutions and credit information furnishers, etc.

These guidelines will be effective from October 1, 2021. The licensed credit bureaus are required to comply with the instructions and submit the complaints data given in the guidelines. The first reporting in this respect will start from January 2022.

The SBP’s instructions said the board of directors and senior management of the credit bureaus are expected to undertake measures to instil a dispute resolution culture across their organisation.

“The customers of credit bureaus, on payment of a prescribed fee, should have access to their credit information in the form of a Credit Information Report (CIR),” it said.

“However, credit bureaus must ensure that the borrowers should not be charged for correcting any information in the CIR that is inaccurate, incomplete, or misleading. The relevant credit bureau shall provide a rectified copy of CIR to the consumer without charging any fee.”

Credit bureaus are required to take reasonable steps to ensure that information furnished through credit information reports is accurate, complete, not misleading, and up-to-date, according to the SBP’s circular.

Credit bureaus are also obligated to put in place necessary safeguards (eg system checks, procedures, and automated processes) to ensure the security and safety of customer information.