Multiple players important for raising the industry bar!
01 Aug 2011
Equifax, a global leader in information solutions, leverages one of
the largest sources of consumer and commercial data, along with
advanced analytics and proprietary technology with the objective of
creating customized insights that enrich both the performance of
businesses and the lives of consumers. Not only this, Equifax empowers
individual consumers to manage their personal credit information,
protect their identity, and maximize their financial well-being.
Equifax Credit Information Services Private Limited (ECIS), a joint
venture between Equifax and six leading Indian financial institutions
(Bank of Baroda, Bank of India, Kotak Mahindra Prime Limited,
ReligareFinvest Limited, Sundaram Finance Limited and Union Bank of
India), has close to 200 members. ECIS has seen remarkable growth and
has gained the trust of financial institutions across India. Presently
it has committed a record base of over 12 crore records.
ECIS is headed by Mr. Samir Bhatia , a Chartered
Accountant who has acquired a wealth of experience over a career
spanning 24 years. He is recognized as one of the leading bankers in
the country during his stint with leading, successful banks such as
Citibank, HDFC Bank and Barclays Bank. He has rich experience and
exposure to all facets of retail and commercial banking. Currently Mr.
Bhatia is actively engaged with members to build a comprehensive pan
India consumer and microfinance bureau with high quality information.
Speaking in a freewheeling interview with Mr. Harsh Roongta and Bienu
Vaghela of Apnapaisa, Mr. Bhatia says, "The culture of usage of
Credit Reports is picking up very well. However, in certain segments
of financial institutions, the usage is still minimal. To crack this
mind set is the real challenge for the Equifax India Head"
What will be the differentiating factors for India from
We have managed to cover a large number of NBFCs, even though it
entails traveling to many smaller towns. We have also roped in
Co-operative Banks. There are around 22,000 NBFCs in India and that's
why we see smaller institutions playing a bigger role. We have
developed a data extractor - proprietary to Equifax, which works even
on PC based data. The technical team members from banks take the data
from there. We want to grow in tier 4 and 5 cities as financial growth
is eventually foreseen to come from these cities.
By involving these banks, you are adding value to your data
but are there any major players missing?
We have with us data from almost all major players in India. On one
hand we are trying to get the footprint wider, whereas on the other
hand we are doing a lot of data gathering and data enrichment,
especially that of public sector banks. We do a lot of work on records
rejected by us. We have a proprietary tool which automatically filters
data to check various anomalies which can then be corrected. In this
way we are working directly with members to streamline and secure
their data cleansing and contribution processes with our time tested
data quality platform used throughout the world.
We have an acceptance rate of 94% which means that large a percentage
of data has been corrected between public sector and private sector banks.
What are the other challenges?
Apart from data quality issues, the other issue is that the culture
of usage of Credit Information Report is still restricted. We visit
various banks' branches and hold training sessions there to apprise
them on the importance of credit reports.
How much do you charge the customer for an Equifax CIR?
We charge Rs. 138/- from the customers and in the case of banks the
price is variable and dependent on the volume of usage.
Mostly history is taken into consideration for negative
reasons, i.e. to deny credit. It is rarely used to give better rates
or faster sanctions to customers with good credit track records.
The credit score is not the only decisioning variable. Banks have
other different factors that they take into account on the basis of
which they draw their own conclusions on a customers profile.
How do you see bureau's role evolving from a consumer's
We believe that number of monthly enquiries that are being made range
between 15-20 lacs across the banks. Now this could be possibly
one-third of the number of loans sanctioned. Some large lenders are
not using credit reports at all. However, we are trying our best to
leverage our expertise to help customers form better lending
Which types of lenders are not seeking CIRs?
A large portion of the Commercial Vehicle Loan industry is not using
credit reports extensively as they have secure asset based products,
and people on the ground know their customers really well. Even gold
loan players do the same for various reasons.
Disputes, another area of concern. How are you gearing up for
Bureaus play an important role in dispute resolution. We have
invested in a sophisticated system which can speed up the process of
follow-ups with banks, and hence resolution time. We recognize this as
a key area of concern and hence a key responsibility as well.
Now that customers have access to the credit scores as well, do you
also plan to provide credit scores to customers Offline and going
We are working on developing a score too, and intend on launching it
in the near future.
Do you think India is ready for multi credit bureau set up?
What challenges as well opportunities do you foresee here?
Of course we are ready for a multi-bureau system. Having multiple
bureaus will only enhance the quality of data available The challenge
as already mentioned is data gathering and data quality, which is
being worked upon by all bureaus. Opportunities are plenty in a
growing economy where living on credit is getting increasingly popular.
Headquartered in Atlanta, Georgia, Equifax Inc. employs
approximately 7,000 people in 15 countries through North America,
Latin America and Europe. Equifax is a member of Standard
&Poor's (S&P) 500 Index. Their common stock is traded on the
New York Stock Exchange under the symbol EFX.