crb, revolutionizing the credit market · 2016. 11. 24. · application of crb clearance q.6: under...
TRANSCRIPT
Confidential | Internal use only
BY ISAIAH OPIYO
CRB, REVOLUTIONIZING THE CREDIT
MARKET
29 JUNE 2016
INTRODUCTION
1. What was your first encounter
with a CRB?
2. How was the experience?
3. What is your perception about
CRB?
Isaac receives a text from his Bank
Notice of Review of Interest Rate on Loans“Dear customer, as a result
of the increase in KBRR,
effective 8th August, your
monthly loan repayment will
increase,”
Isaac’s reaction!Oh, how does this bank expect me to
increase my loan repayment yet I
have no extra income left to commit?
No need to worry, I will just go ahead
with my usual monthly loan
repayment.
3 months laterHello Isaac, this is to notify you
that your loan account is in
arrears of 3 months. Should you
fail to settle the arrears by today,
we will have no option but to
submit your default info to CRB
for adverse listing as required by
law.
YOUR CONSUMER RIGHTS UNDER CRB REG 2013
Did you know that your
right as a consumer are
protected in the CRB
Regulations 2013?
Highlight of Consumer Rights
1. What information can be shared
2. Confidentiality
3. Accuracy of info shared
4. Your right to dispute the information
shared
5. The right to access your info from
CRB
YOUR CONSUMER RIGHTS
1. Prohibited Information
2. Consent to share customers info with CRB:
3. Notice to submit Info to CRB
4. Confidentiality
5. CRB to verify accuracy of info submitted
YOUR CONSUMER RIGHTS
6. Right to Dispute info
7. Accuracy of Information
8. Inaccurate information
9. Post Listing Notice
10. Deletion of adverse info after expiry of 5
years after final settlement.
WHAT TYPE OF DEBTOR ARE YOU?
1. Able and willing to pay e.g good borrowers
2. Able but Unwilling to pay e.g. adamant
HELB beneficiaries
3. Unable but willing to pay e.g. a borrower
who has lost a job
4. Unable and Unwilling to pay e.g. HELB
beneficiaries who are still job seekers
PITFALLS FOR ADVERSE LISTING
1. Abandoning a bank account that attracts
monthly ledger fees
2. Breach of a standing order
3. Failure to pay the ATM Application fees
4. Issuance of bounced cheques
5. Failure to adjust monthly repayment
6. Failure to repay mobile loans.
WHAT HAPPENS WHEN YOUR BANK COLLAPSES
Hello Irene, have you
heard the news from
CBK regarding the
collapse of Imperial
Bank Ltd?
BREAKING NEWS: IMPERIAL BANK COLLAPSES
I know I owe them
Ksh.380,000 which I
borrowed. Now that it has
collapsed, I cant pay and
wont pay!!!!!!!
Misconceptions1. Any outstanding loans are written off when the
bank collapses
2. The loans are terminated and so no need to repay
3. Borrowers are supposed to stop repaying the
loan until the collapsed bank is operational again.
4. Such loans are not recovered since there is no
one to claim for them.
5. The loans should be repaid immediately in full
when the bank collapses.
What to Know as a borrower
Information on the loans are still shared with credit
reference bureaus by Kenya Deposit Insurance
Corporation (KDIC).
All outstanding loans of collapsed banks are payable to
Kenya Deposit Insurance Corporation (KDIC).
All outstanding loans recovered are received by Kenya
Deposit Insurance Corporation (KDIC).
Kenya Deposit Insurance Corporation (KDIC) has all the
information on all assets and liabilities (outstanding
loans) of collapsed banks.
List of Collapsed lenders under KDIC
Dubai Bank Ltd
Imperial Bank Ltd
Kenya Finance Bank Ltd
Pan African Bank Ltd
Pan African Credit &
Finance Ltd
Prudential Bank Ltd
Middle Africa Finance
Prudential Building
Society
Postbank Credit Ltd
Ari Bank Corporation Ltd
Heritage Bank Ltd
Meridien BIAO Bank Ltd
Trust Bank Ltd
Central Finance Ltd
Inter Africa Finance Ltd
Nairobi Finance Ltd
Reliance Bank Ltd
Euro Bank Ltd
Fortune Finance Ltd
Trade Bank Ltd Thabiti
Finance Co. Ltd
Daima Bank Ltd
Now I have to work on
how to repay the loan
even though the bank
has collapsed
OPTIONS AFTER ADVERSE LISTING
1. Settle the outstanding amount in full
2. Activate your NPL account
3. If inaccurate, pursue dispute resolution
4. Obtain CRB clearance certificate to access
loans
APPLICATION OF CRB CLEARANCE
Q.1: What is CRB Clearance?
Q.2: Where is CRB Clearance applicable?
Q.3: Never borrowed, can I still get CRB
Clearance?
Q.4: I have defaulted and I have not settle the
arrears. Can I still get Clearance?
Q.5: I am still servicing a loan, can I get CRB
Clearance?
APPLICATION OF CRB CLEARANCE
Q.6: Under what scenario is CRB Clearance
not applicable?
Q.7: I paid for CRB Clearance Certificate but
my name is still in CRB
Q.8: Why Do I need to pay Ksh.2,200 for CRB
Clearance?
Q.9: How long is CRB Clearance Valid?
FUTURE OF THE CREDIT MARKET
1. Rollout of mobile loans and platforms for
consumer loans
2. Improved turnaround time
3. Use of CRB for KYC purposes
4. Use of CRB analytical tools for collection
prioritization
5. Use of credit scoring for credit decisioning
WHAT IS CREDIT SCORING?
Rate credit risk of the following category:
1. Politicians
2. Lawyers
3. Debt collectors
4. Relatives and friends
5. Bankers
6. Pastors
WHAT IS A CREDIT SCORE?
1. It is an arithmetic number that indicates
the credit risk of a borrower
2. It summarizes all the information contained
in the report to a number
3. It makes it possible to automate the credit
decisions
Illustration using KCSE results
Thank You