Al Etihad Credit Bureau says 'large number' of banks have failed to supply important information about customers
A UAE government platform that will allow financial institutions to check consumers’ creditworthiness before lending to them has reported that just one of the country's 46 banks has submitted data on its clients’ credit history over the last two years and urged the remaining lenders “to follow suit”.
Al Etihad Credit Bureau (AECB), a federal government company specialised in providing UAE-based credit reports and other financial information, said a "large number of banks" have not yet completed the process even though the AECB is ready to launch.
At a meeting, the Bureau's board of directors stressed the need for all UAE banks and financial institutions to submit their customers' credit data for the past 24 months, including Emirates ID details.
“The Board of Directors expressed its thanks to the National Bank of Fujairah for its support and cooperation, as it is the only bank to submit accurate and reliable credit data for the past two years. The Board of Directors has urged remaining banks to follow suit and provide their credit data as soon as possible,” a statement cited by news agency WAM said.
"Despite the continued efforts made by banks to provide their credit data, a large number of them have not yet fully completed the process of providing the past 24 months of credit data,” it added.
Last month, the Bureau announced it was ready to start operations - after a planned launch last year was delayed.
As part of its operational readiness, the Bureau said it has successfully fulfilled all of the requirements for issuing credit reports, including establishing secure links with all financial institutions, and completing internal and external risk assessments.
Until now, banks in the UAE have been unable to access data on consumers at other financial institutions when making a lending decision. This has created a situation where some have borrowed from many lenders and run up huge personal debts which proved impossible to repay.
Defaulting on debt is deemed a criminal, rather than a civil, offence in the UAE, with those unable to meet repayments facing jail sentences.
According to the UAE Central Bank there are 46 commercial banks registered in the emirates, while nine have representative offices.