Student’s Loan Bureau
The operation of credit bureaus will further reduce the struggle of that entity with high borrower default, Monica Brown, Executive director of the Student’s Loan Bureau said. The Credit Reporting Act took effect that October. It was passed on August 31 last year. A credit bureau collects information on employers, insurance companies and borrowers, which is then the information offered to lenders after entered into credit reports.
The Act has legalized the sharing of credit information between specified financial institutions. It is enabling creditors to make better lending decisions. The Bank of Jamaica (BOJ) which is the regulator is now in the process of assessing applications for potential bureau operators. A Student’s Loan beneficiary who has not repaid, the information will be fed into the bureaus. They will use it in assessing the rating that will be assigned to the individual. This rating would affect the way borrowers do business, the SLB Director outlined.
The entity is able to collect on the loans it has disbursed the need for external funding would be reduced, The SLB director said to the extent. Banks, the BOJ, building societies, the National Housing Trust, financial institutions licensed under Financial Institutions Act, the SLB, and the Development Bank of Jamaica are among institutions that will be able to supply credit information on borrowers to the credit bureau.