2015/SFOM/S/007 Session: 2

Transcription

1 2015/SFOM/S/007 Session: 2 Promoting a Stable Economy, a Dynamic Philippine Entrepreneurial Environment and Creating an Affluent Consumer Base in Preparation of ASEAN Integration Purpose: Information Submitted by: Philippines Special Senior Finance Officials Meeting Clark, Philippines January 2015

2 The Philippine Credit Information Corporation Promoting a Stable Economy, a Dynamic Philippine Entrepreneurial Environment and Creating an Affluent Consumer Base In Preparation of ASEAN Integration Start of Part 1 The CIC Credit Information System at a Glance Promoting the Concept of a Credit Registry and an Integrated ASEAN to Entrepreneurs and the Public Best Practices 1

3 The Philippine Credit Information System at a Glance POLICY STATEMENT The operations and services of a credit information system can be expected to: greatly improve the overall availability of credit especially to micro, small and medium scale enterprises; provide mechanisms to make credit more cost effective; and reduce the excessive dependence on collateral to secure credit facilities. The CIC at a Glance RELEVANCE OF ENTREPRENEURS Internal Drivers: Stimulate Economy Generate Jobs Increase Consumer capabilities Diversify Credit Portfolios from Corporates to Entreps Protect the Economy Stability via greater visibility of overall exposures Integration Drivers: Enable Competition Creative and Dynamic Development of Products for export Capacity for Consumption Diversify locally available products and services Become a ready market for investment 2

4 The CIC at a Glance OTHER SIGNIFICANT TARGET MARKETS Overseas Workers: and amount to Provide significant inflows loanable amounts into the economy as basis Integrate productive and for entrepreneurial qualified OFWs into host ventures economies Integration with a OFWs represent seed contract registry will entrepreneurs or channels align contract duration in host countries The CIC at a Glance Create by law (RA9510) Supervised by the SEC Supported by the BSP A REGISTRY not a Bureau GOCC with 60% Govt 40% Private ownership Created in 2008 Official Start Date 2011 Three to five year horizon IFC Consultation Support Mandatory Submission/ Voluntary Use Positive and Negative Credit Data Single Product Three year retention of Data Process of Privatization begins after 5 years of Operation 3

5 The CIC at a Glance 1. To receive and consolidate basic credit data 2. To act as a central registry or repository of credit information 3. To provide access to reliable, standardized information on credit history and financial condition of borrowers The CIC at a Glance Elements of the CIC Policy Statement (Baseline for Integration Issue) Market: Improve the overall availability of credit to MSMEs Cost to Market: Provide credit information at the least cost to eligible participants (approx USD1.50 to USD2.50) Protection of Borrower and Lender:Ensure the protection of consumer rights (use of data) and the existence of fair competition in the industry at all times Reduce the overall credit risk thereby contributing to a healthier and more stable financial system 4

6 The CIC at a Glance Cooperatives RA 9510 A Credit Cards B Microfinance C Banks/ Financial Institutions USERS Promoting an Integrated ASEAN KEY: LOCAL ACCEPTANCE OF CIC and ASEAN INTEGRATION Entrepreneur: Emphasising data and behaviour as risk effective management tools. Reducing the emphasis on collateral. Rationalizing time based views into an entrepreneurs behaviour. Allowing FIs to take calculated risks and increase loan amounts, reduce interest rates, and lengthen tenures, when appropriate as a business decision and a competitive differentiator. Consumer: Maximizing the capacity to purchase by allowing leverage off good credit behaviour as proof of capability to pay alongside tangible proofs of income. 5

7 Possible Data Collection and Use Strategy: ASEAN and Local Targeting the likely Entrepreneurs Emerging Idea: Engage credit information sharing activities from a private intuition level vs national policy level Consideration: Founded on permission from data subjects Security, Validity, and Inegrity Alignment on proper use of data Legal Remedies for consumer complaints and fraud 6

8 Philippine Experience Best Practice Created by law (RA9510) Supervised by the SEC Supported by the BSP A REGISTRY not a Bureau Short and Medium horizon Mandatory Submission IFC Consultation Support Consultations with stakeholders on data elements Credit Data Continuous Education Program Includes Private and Corporate Credit Information Consumer Drivers vs Regulation Drivers Engagement of Private Sector Initiatives parallel to Govt Initiative The Philippine Credit Information Corporation Building a Credit Registry to Support a Dynamic Entrepreneurial Environment and Create and Affluent Consumer Base End of Part 1 7

9 The Philippine Credit Information Corporation Building a Credit Registry to Support a Dynamic Entrepreneurial Environment and Create and Affluent Consumer Base Start of Part 2 3 Year 3 Phase Promotion of Use Education Needs Analysis Deployment Development and Customization Education YEAR 1 Development of Credit Information System Sample Data Contribution User Acceptance YEAR 2 Collection of data : 80% of universe of data from 100% from the largest FIs YEAR 3 Full public use 8

10 Needs Analysis Promotion of Use Development and Customization Education Education Deployment PHASE 3 Yr 1 and 2 Yr3 Needs Analysis Awareness that System in Use Promotion of Use by Public Development and Customization PHASE 1 Education of FIs and Public Education Of FIs and Public Deployment and Use by FIs PHASE 2 9

11 PHASE 2 YEAR 1 PHASE 1 Vendor Acquisition Needs Analysis Steering Committee composed of FI Association Representatives Education Speaking engagements with FIs internal users Media Coverage Development of regular media and online presence Info campaign on data contribution * June 2015 YEAR 1 Phase 2 Education Speaking engagements with FIs internal users Media Coverage Development of regular media and online presence Info campaign on data contribution Collection of data from FIs and other contributors PHASE 2 10

12 * June 2015 Year 1 Phase 3 Education Speaking engagements with FIs internal users Media Coverage Development of regular media and online presence Info campaign on data contribution Collection of data from FIs and other contributors Education Of FIs and Public Financial Institutions: Encourage use of CIC data Create a competitive environment among FIs Consumer rights Entrepreneurs: Awareness of the future value of good and clean financials Awareness of good personal and corporate credit history Consumer rights Consumers: Awareness of impacts of bad debt Credit and Financial Responsibility Consumer rights PHASE 2 11

13 The Philippine Credit Information Corporation Building a Credit Registry to Support a Dynamic Entrepreneurial Environment and Create and Affluent Consumer Base End of Part 2 12