Reducing NPA in the market:
CRIB to bring credit scoring
The Credit Information Bureau of Sri Lanka (CRIB) will introduce
credit scoring to Sri Lanka soon. It is a rating given to all citizens
based on their borrowing performance. If the rating is good, the
benefits to the public from lending institutions and banks are also high
such as preferential loans and preferential interest rates.
Through credit scoring every person is treated equally as each person
has their own rating and if the credit performance is good everyone is
privileged to get credit facilities with less trouble, Credit
Information Bureau of Sri Lanka General Manager Gamini Karunaratne told
Daily News Business.
He said the Central Bank has noticed that the incidence of cheques
bouncing due to insufficient funds in accounts has increased and it has
become a big problem for the banks. As cheque returns due to
insufficient funds in the current account is legally enforceable, the
CRIB will list people if their cheques are bounced three times due to
Another step taken by the CRIB is to create a register for moveable
assets such as machines, equipment, vehicles, the harvest and all
others, so that the lenders become more secure. The aim of creating this
register is protecting the lenders, he said.
The information provided by the CRIB will assist the financial
institutions to take better decisions and those decisions will help to
reduce the amount of Non Performing Advances (NPA).
The CRIB wants to minimize the bad debts in the credit market and for
that the lending institutions and the banks has to have a close
relationship with the CRIB, Karunaratne said.
The CRIB is where the information of good and bad credit, and the
information of all the authorized lending institutions in the country
are stored, but most people think that it is where only the bad credit
users are listed. To dispel this myth and to create a more powerful
awareness among the public, the CRIB will launch a public awareness
program from November 2009, he said.
The CRIB has noticed that the usage of credit reports has increased
A reason for this is that there is an increased credit growth in the
country and the other reason is that the lending institutions are trying
to be cautious in granting credit facilities. Therefore, the CRIB has
now taken several steps to issue credit reports for the general public
from December 2009.
With the implementation of this program, the public will benefit by
obtaining credit reports once every six months.
Then the public will able to issue their credit information to the
lending institutions and banks when they are in need of credit
facilities, he said.
“We have done more than 80,000 credit reports by the end of September
The present average of issuing credit reports is over 4,000 per day
and more than 60,000 credit reports are issued monthly by the CRIB,” he