The Bank of Ghana has issued a public notice highlighting that it has expanded the list of institutions required to participate in the Credit Reporting System (CRS) established under the Credit Reporting Act, 2007 (Act 726) in accordance with the Credit Reporting Regulations, 2020 (L.I 2394).

According to BoG, it has expanded the participating institutions to include: Telecommunication Companies, Utility Companies, Retailers, Mobile Money Operators, Financial Technology Companies (FinTechs), and Government institutions that offer credit to Micro, Small and Medium Enterprises (MSMEs) in the country.

Also, BoG stated that it has included Institutions that provide identification documents, Entities that supply goods and services on a post-paid or instalment basis, as well as the Student Loan Schemes provided by private or government agencies. However, the Central Bank indicated that other entities that have relevant data and information that complies with permissible purposes of credit bureaus will be allowed to participate in the CRS.

Benefits of Credit Information

Correspondingly, the BoG highlighted some of the benefits of the availability of Credit information to both borrowers and lenders.

“Credit information sharing is beneficial to both lenders and borrowers/debtors as it helps lenders/creditors better assess the credit risk of each borrower/debtor. It also helps to facilitate the delivery and pricing of credit on a differentiated basis”.
Bank of Ghana

Furthermore, the BoG seized the opportunity to educate the public on the current Credit Reporting System (CRS). The CRS, according to the Bank of Ghana, is a database established under Act 726 to promote the sharing of information on the credit history of debtors with lenders and other users of the CRS.

Duties of participating institutions

In line with Sections 24 and 26 of Act 726 and Regulation 22 of the Credit Reporting Regulations, 2020 (L.I 2394), eligible participants in the CRS such as the institutions listed above, are required to perform certain key functions.

These institutions are to provide credit information on their customers to all Credit Bureaus licensed by the Bank of Ghana within seventy-two (72) hours after entering into a credit agreement or facility. They are also expected to obtain credit reports on prospective customers before concluding credit transactions with such customers.

“This will afford the above-listed entities the opportunity to obtain information on the credit behavior of their clients prior to establishing credit relationships, while ensuring that the information they provide to the CRS on their customers’ credit behavior helps other creditors to make prudent credit decisions”.
Bank of Ghana

The Bank of Ghana indicated that it has licensed three Credit Bureaus to provide credit reporting services to licensed financial institutions and to the above-listed category of institutions since the coming into effect of Act 726 in 2007.

The licensed credit bureaus are: XDS Data Ghana Limited, Dun & Bradstreet Credit Bureau Limited and HudsonPrice Data Solutions Limited. Consequently, The Bank of Ghana per this notice, “hereby advises the above-listed institutions to take steps to comply with the provisions of Act 726 by October 31, 2021”.