GLOBAL REMITTANCE FIRM TransUnion is exploring cross-border sharing of credit data, a tool seen to improve access to credit for overseas Filipino workers (OFWs).
In a statement, TransUnion Philippines said they are crafting an online system that will allow their customers to request to send their credit history to a foreign lender.
“Cross-border data sharing will assist OFWs in participating in the credit economy of their resident country and even after they decide to come home for good,” said Pia Arellano, president and chief executive officer of TransUnion Philippines.
“It will help open up more opportunities to access credit for purposes like entrepreneurship, obtaining mortgages and personal loans, or accessing the rental housing market, which can translate into more income for remittance, expenditure, or investment.”
The private credit bureau said there is scope to help OFWs and their families to tap bigger credit lines, given the record P32.213 billion personal remittances they sent home in 2018.
Remittances are equivalent to a tenth of the Philippines’ gross domestic product (GDP), which likewise supports household spending and domestic demand.
Cross-border sharing of credit data has been limited to the members of the European Union, given concerns on regulatory uncertainty and the lack of harmony of reporting guidelines among countries.
Ms. Arellano added that channels for global credit bureau coordination remain in a “nascent” stage, adding that they are pushing discussions on how to allow Filipinos to access their credit information wherever they are. In turn, this is expected to spur further economic growth.
TransUnion is one of four private credit bureaus accredited by the state-run Credit Information Corp. to handle and process consumer data, together with CIBI Information, Inc., Compuscan and CRIF S.p.A.
TransUnion’s credit scores cover historical data for credit cards, personal and car loans, as well as property mortgages collected from member banks, card issuers, lending companies and even cooperatives.
The firm assigns a three-digit credit score to individual borrowers, who are broadly classified as low, medium, or high-risk clients. The local unit of the Chicago-based credit scorer, in turn, provides banks and lending firms some insight as to whether a person is worthy of securing a loan. — Melissa Luz T. Lopez