IV. PROMOTING ROBUST CREDIT REPORTING
STANDARDS
The presentations1 in the session on promoting robust credit
reporting standards focused on lessons for information sharing
standards in the Asia-Pacific region, a discussion of best
practices for efficient credit reporting systems and the
experience of Thailand. Private sector groups, including ABAC
and the Asia-Pacific Credit Coalition, have been supportive of
promoting full-file and comprehensive credit reporting to private
credit bureaus in the region, together with the development of a
standard that meets the OECD Fair Information Practices (1980)
that provides to data subjects rights of notice, access, choice,
notification of adverse reactions, dispute and correction to
ensure that only responsible and experienced actors will collect
and maintain the data.
There has been a long history of investigation and study of
information-sharing, and studies have shown that full-file and
comprehensive credit reporting increases lending to the private
sector, especially among lower-income segments more than
other reporting regimes, and results in better loan performance
than segmented and negative-only reporting, In addition, private
credit bureaus with comprehensive data were found to increase
lending to the private sector. The following data support these
conclusions:
•
In the US, acceptance rates climb as information moves to
full-file from negative-only reporting in all cases.
• Using US data, default rates climb as information moves
from full-file to negative-only reporting in all cases, as good
risks are not effectively distinguished from bad ones.
• Data sharing improves the quality of information for risk
provisioning allowed under Basel II. Consequently, there are
1 Presentors in the session on promoting robust credit reporting standards
were Dr. Michael Turner (President, PERC), who made the presentation on
lessons for information sharing standards in APEC; Mr. Anthony Hadley
(V