Lenders to get borrowers’ consent on data sharing
News
By
Graham Kajilwa
| Sep 03, 2021
Credit providers will now require written consent from borrowers to have their information shared with other lenders.
It will also be unlawful for creditors to request more than the necessary information as stipulated in a code of conduct launched by the Credit Information Sharing Association of Kenya (CIS Kenya).
The document was unveiled yesterday to guide the industry on how information is shared among them under the Banking (Credit Reference Bureau) Regulations, 2020.
READ MORE
The Standard Group forges stronger ties with China
EAPCC Board declines to ratify appointment of new CEO
State's affordable housing drive still a hard sell two years later
Musk's AI startup raises further Sh774b
Japan Airlines suffers delays after carrier reports cyberattack
Impact of Finance Bill withdrawal hits State revenues
Coffee cherry fund advance to farmers up by 500pc to Sh6.7 billion
Standoff at East Africa Portland Cement as employees protest against new management
Central Bank of Kenya has given a nod to the code of conduct.
The code of conduct will govern non-regulated providers to ensure robustness of mechanism and address some of the challenges, which include unnecessary data disparities in credit reference bureaus (CRBs), failure to submit consumers’ positive data or make regular updates.
Others are slow response to customer queries and disputes, delays in correcting erroneous customer data and lack of physical offices or operational telephone contacts.
"The code of conduct has three key objectives: data quality, consumer protection and customer-centricity,” CIS Kenya said in a statement.
The association has a membership of 70 drawn from commercial and microfinance banks, credit-only microfinance institutions, Saccos, leasing companies, debt collectors and liquidators.
The document lists 12 credit reporting principles, which dictate customer information must be shared in accordance with applicable laws and regulations and international best practices.
“Members should obtain clear and specific consent from their customers to share their credit information, preferably in writing,” the CIS Kenya statement said.
Customers must also be issued with specific listing and adverse action notices, and any other notice stipulated in the CRB Regulations.