ABU DHABI Jan 7 A long-awaited federal credit
bureau will start operating in the United Arab Emirates this
quarter, allowing banks to check a customer's financial health
before extending new debt, the state-owned company said on
Al Etihad Credit Bureau expects to complete agreements with
banks to provide credit information and create an electronic
database by the end of January, it said.
"As soon as this is achieved, along with receiving formal
approval of the bureau's regulations and credit report charges
from the UAE Cabinet, the Al Etihad Credit Bureau will commence
operations," chief executive Marwan Ahmad Lutfi said in the
Pilot phase testing has been successful with more than 90
percent accuracy achieved, he added.
Until now, banks in the UAE have often been unable to access
data on consumers at other financial institutions when making
lending decisions. This has allowed borrowers to obtain money
from many lenders and run up big debts which sometimes prove
impossible to repay.
The idea of a UAE credit bureau was talked about for years,
but a previous attempt in 2006 by the Dubai government to set up
a private sector credit bureau, Emcredit, failed as banks
refused to divulge customer data.
(Reporting by Stanley Carvalho, Editing by Andrew Torchia)