First Licensed Credit Bureau Opens its Doors in Guyana to Support Access to Finance
Vanessa Bauza, IFC
Phone: +1 202-458-1603
Judy Semple-Joseph, Creditinfo Guyana
Georgetown, Guyana, September 27, 2013 – IFC, a member of the World Bank Group, has helped the Bank of Guyana establish the country’s first credit reporting system, which will enable local financial institutions to share credit information and better manage lending risks to ultimately boost access to finance for individuals and small businesses. CreditInfo Guyana, which officially launches its operations today, was chosen by the Bank of Guyana as the country’s first licensed credit bureau.
Consumers and small and medium businesses in emerging markets are considerably less likely to obtain a loan than those in developed markets due to lack of information about their credit history. A credit reporting system, governed by robust legal and regulatory frameworks, helps provide information on borrowers in an effort to ease financing constraints. IFC studies conducted in 51 countries show the percentage of firms reporting financing constraints declined from 49 percent to 27 percent after credit bureaus opened in their regions.
With support from Canada’s Department of Foreign Affairs, Trade and Development, IFC helped the Bank of Guyana gain the expertise to solicit and evaluate potential credit bureau operators. It also provided technical assistance which allowed the Bank of Guyana to develop the Credit Reporting Act of 2010 and related regulations. This support laid the groundwork for the country to license CreditInfo Guyana.
“Credit bureau services will benefit financial institutions and credit providers in Guyana, but most importantly they will benefit the people by allowing lenders to extend more credit,” said Governor Lawrence Williams of the Bank of Guyana. “The bureau will enable access to finance for consumers and entrepreneurs, while also encouraging them to be responsible in their financial commitments. In a market such as Guyana, this can have a dramatic impact on economic development.”
Since 2009, IFC has helped central banks in the Caribbean develop the legal and regulatory frameworks that underpin credit reporting systems. The Bahamas, Belize, Haiti, the Organization of Eastern Caribbean States, and Suriname are also developing credit bureau legislation. IFC has been working with central banks in the region to organize a series of conferences aimed at sharing local expertise and transforming the Caribbean’s credit culture.
“Credit bureaus are important to avoid over indebtness. A credit reporting system in Guyana should help open doors for small and medium-sized enterprises by increasing access to credit that will in turn enable them to grow, create jobs and benefit the overall economy,” said Ghada Teima, IFC Access to Finance manager for Latin America and the Caribbean. “IFC’s Caribbean Credit Bureau Program has been effective in strengthening the financial infrastructure in numerous countries in the region.”
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit www.ifc.org