System aims to encourage more transparent lending in the emirates
The UAE will launch the Al-Etihad Credit Bureau in the first quarter of 2014, in an effort to improve the quality of information available on the credit history of businesses in the country.
The bureau aims to encourage responsible lending by banks and financial institutions and reduce the volume of credit losses from bad or non-performing debts. The government hopes the bureau will improve the transparency of borrowing in the emirates.
By the end of January, the government-backed organisation will finalise agreements with UAE-based banks to create a database of individuals and businesses credit information. An electronic link between banks is being set up to support this database.
In mid- 2013, a limited pilot phase was conducted to test the new credit reporting system and a number of financial institutions were able to provide over 90 per cent accuracy of the credit information.
The bureau has also run various training workshops on how to access and use the database.
A MEED Subscription...
Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.