WHAT IS A CREDIT BUREAU?

 A credit bureau is an agency that collects and maintains individual credit information and sells it to lenders, creditors, and consumers in the form of a credit report. The bureau compiles information on individuals and business entities regarding their credits, repayment, etc. and then creates a comprehensive credit record that may be made available to lending institutions and other users.

1) WHAT SERVICES DOES A CREDIT BUREAU PROVIDE?
  • The primary product of a credit bureau is a credit report. However, a credit bureau may provide additional products and services that leverage the predictive powers of the credit information it holds.
  • Without information from a credit bureau, creditors typically must impose an additional risk premium prior to giving loans. The subsequent higher loan fees and interest rates can put undue pressure on business profitability, which frequently leads to higher rates of default.
  • The information that credit bureaus provide enable creditors to be proactive in preventing debt problems, even for existing account holders.
2) ARE THERE CREDIT BUREAUS IN NIGERIA?

Yes. There are three credit bureaus in Nigeria. They are:

    • CreditRegistry Plc
      Address: Eko Pearl Towers A, Eko Atlantic City, Victoria Island, Lagos
      Telephone: 01 454 8700, 0700-CREDITBUREAU
      Website: www.creditregistry.ng
    • FirstCentral Credit Bureau Limited
      Address: 37A Raymond Njoku Street, Off Awolowo Road, Ikoyi, Lagos
      Telephone: 0817 837 7643
      Website: www.firstcentralcreditbureau.com
    • CRC Credit Bureau Limited
      Address: 2nd floor, 26 McCarthy Street, Onikan, Lagos
      Telephone: 01 628 3900, 01 628 3901
      Website: www.crccreditbureau.com
3) ARE CREDIT BUREAU ACTIVITIES REGULATED?

Yes, In October 2008, the Central Bank of Nigeria (CBN) issued Guidelines for the Licensing, Operation & Regulation of Credit Bureaus in Nigeria under Section 57 of the CBN Act No. 7 of 2007. This was revised and circulated in November 2013.
Also, there is a Credit Reporting Act 2017 signed into law by Prof. Yemi Osinbajo, the Vice President of the Federal Republic of Nigeria.

4) WHAT KIND OF REPORT WILL THE BUREAU PROVIDE IF I HAVE NEVER BEEN ACTIVE IN THE CREDIT MARKET?

Your report will indicate this fact and provide demographic information only if available as your name, address, contact details etc., which will be helpful in KYC.

5) WHAT ARE THE BENEFITS OF USING CREDIT BUREAUS?

Access to finance is a fundamental prerequisite for successful operation of any business whether small, medium or large. Credit Bureaus are identified internationally as a financial infrastructure capable of assisting in providing credit worthy information with a view of assisting lenders in taking informed decisions about their borrowers. 

Credit bureaus enhance reliance on reputational collateral than on physical collateral. Therefore, it eases the chances of access to credit for consumers and businesses with impeccable historical repayment records. 

Credit Bureaus help you discover if anyone made unauthorized purchases or has stolen your identity to access your bank accounts or open other lines of credit in your name.

6) WHAT IS A CREDIT REPORT?

It is a report generated by the Credit Bureau and contains demographic and credit information on an individual including:

    • Name
    • Address/Contact details
    • Other identifying information unique to the individual – e.g. National Identity Number, BVN, date of birth etc.
    • Credit Score
    • Type of Credit account(s)
    • Terms of credit including original debt and balance outstanding
    • Credit payment profile
    • Other public records
7) WHO USES CREDIT INFORMATION REPORT?

The primary users of credit information report include creditors, such as banks, mortgage finance companies, leasing agencies, insurance companies, micro-finance and SME lenders, asset management companies and other businesses that provide services to consumers on credit, including landlords, telecom and utility service providers. Additionally, because of other intrinsic characteristics of credit information, employers, for example, may use information from a credit bureau to predict employee reliability, while insurers may use credit bureau information to determine insurance risk for prospective policyholders.

8) WHERE DOES CREDIT BUREAU INFORMATION COME FROM?

The information in a credit bureau comes primarily from creditors. However, a credit bureau may augment its information with those from the public domain, such as information from court judgments, bankruptcies and – in the case of businesses – supplier information, balance sheet and cash flow information, etc.

9) WHAT ARE THE BENEFITS OF HAVING A GOOD CREDIT REPORT?
  • Lower interest rates
  • Higher credit score
  • Ability to obtain credit without collateral or with reduced collateral
  • Ability to acquire capital intensive items such as houses, cars and household goods without saving up for extended periods to pay cash
  • Earning a reputation of being a responsible person
10) HOW CAN I GET A GOOD CREDIT REPORT?

You build a good credit report by:

  • Paying your debts as at when due
  • Being truthful with any information supplied when applying for credit
  • Taking credit responsibly
11) HOW DO I ORDER MY CREDIT REPORT?

To order your personal or business credit report, please visit any credit bureau of your choice listed below and make a request or go to the website address of any credit bureau of your choice and follow the instructions outlined.

  • CreditRegistry

Website: www.creditregistry.ng

  • FirstCentral Credit Bureau

Website: www.firstcentralcreditbureau.com

  • CRC Credit Bureau

Website: www.crccreditbureau.com

12) CAN ANYONE ELSE ACCESS MY INFORMATION?

No one other than entities allowed under the Central Bank of Nigeria and which have been registered with the Credit Bureau (authorized entity) may access any information.

13) IS MY CONSENT REQUIRED BEFORE ANYONE CAN ACCESS MY INFORMATION?

No one other than entities allowed under the Central Bank of Nigeria and which have been registered with the Credit Bureau (authorized entity) may access any information.

14) HOW CAN I BUILD A HEALTHY CREDIT HISTORY?

Credit history is generally defined as the record of a borrower’s payment behavior that shows his or her ability to repay a loan. It also includes information about late payments and bankruptcy. The significance of credit history lies in the fact that it acts as an important parameter for approval of loans by banks and financial institutions.

A healthy credit history is in fact an intangible asset created by an individual which remains a life-long companion. In an era when credit bureaus are growing and influencing credit decisions of banks and financial institutions, it is important to maintain a healthy credit history.

Even if we ignore the need for a good credit history exclusively for the purpose of borrowing, building a good credit history still remains important as credit behavior shows our approach towards managing our expenses and building a strong financial base.

While building healthy credit history is important, it is also important to know how to build a healthy credit history. The following steps are extremely important in building healthy credit, which we must follow.

15) WHAT TO DO IF YOU HAVE ANY ISSUE IN YOUR CREDIT REPORT?

Please go to the website address of any credit bureau of your choice, make a request for your credit report and a list of requirements needed to access your credit report will be provided.

16) WHAT DO YOU NEED TO ACCESS YOUR CREDIT REPORT FROM ANY OF THE CREDIT BUREAUS?

If you have any issue with your credit report, please send a formal notification of the issue by visiting the website address of the credit bureau and sending a mail stating what the issues are.