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| OVERVIEW |
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The growth of a country’s financial sector is directly related to its development as a whole, a strong financial infrastructure provides the essential capital needed to allow entrepreneurship to flourish. |
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| BACKGROUND |
- Banks have expanded their capital base and are in a stronger position to extend credit to develop the economy.
- Microfinance Banks has boosted this growth as more than 700 MFB’s were given licenses.
- Consumers credit policy was passed.
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FACTS |
The Nigerian credit market is under developing and underperforming.
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Less than 5% of bank customers are borrowing customers.
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Large numbers of consumers and small business borrowers are excluded from the credit market.
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The absence of reliable credit information
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Cost of borrowing is high.
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What IS A CREDIT BUREAU? |
Credit Bureaus collect information on a
borrowers credit history from various sources
including financial institutions, non Bank
lenders, telecoms, courts and other sources.
The information is then merged and analysed to form a comprehensive credit history record for each borrower and sold to lenders in the form of credit reports or credit scores.
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ENABLING ENVIRONMENT |
Before a credit bureau can operate successfully, there needs to be enabling environment.
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Public need to be educated about credit and its benefits
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Customers must be assured of security of information
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Lenders must overcome their distrust of competitors
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