The South African Credit Information System
This presentation provides an overview of the South African Credit Information System, describing the following characteristics:
- Voluntary information sharing;
- Application of the principle of reciprocity;
- Use of sophisticated scoring models;
- Full-file credit reporting, where both positive and negative information is shared;
- Fixed and reasonable data retention periods;
- A legitimate and non-judicial dispute resolution mechanism that resolves disputes between consumers and credit bureaus or their subscribers;
- The code of conduct within which credit bureaus operate.
- Identifies the role-players in the South African Credit Information System;
- Outlines the following functions of the Credit Information System:
- Improving risk management,
- Enabling lenders to increase the amount of lending,
- Reducing default rates,
- Assisting borrowers in developing credit profiles,
- Preventing borrowers from becoming over-indebted.
- Outlines how the system operates;
- Lists the sources of public and private information.
The presentation concludes by listing the main characteristics of a Credit Information System as follows:
- Collecting data from various sources;
- Offering voluntary, extensive full-file information sharing;
- Having scoring systems that categorize credit applicants into risk classes;
- Following the principle of reciprocity;
- Operating within a clearly defined framework of good practice principles;
- Having mature private credit bureaus that are not subject to statutory limitations.