Loans: Firm Unveils Credit Rating Score for Nigerians

By Modupe Gbadeyanka

A Lagos-based company known as CRC Credit Bureau (CCB) has come up with a unique three-digit number credit rating system to assist financial institution make quick and informed credit decisions.

Some weeks ago, the Central Bank of Nigeria (CBN) mandated banks to increase their loan to deposit ratio to 60 percent by the end of September 2019. This policy is to spur the economy by making funds available to small business owners, who are the main driver of the economy.

Lenders have been very careful in giving out credit facilities to customers because issues with repayment and the absence of quality credit rating system to help them have an idea of which customer has the potential of paying by an approved loan.

But CCB is coming at the right time to take away this and other fears with its system, which has numbers from 300-850 that summarizes customer’s history of borrowing and paying back loans or post-paid services. The allocated 3-digit number represents how risky it is to do business with holder.

At the unveiling of the credit rating system in Lagos some days ago, Managing Director and Chief Executive Officer of CRC Credit Bureau, Mr Tunde Popoola, informed newsmen that the system was done in collaboration with an America company known as Fair Isaac Corporation (FICO).

He explained that the initiative is a “credit grading system, with 300 being the lowest grade like an ‘F’ in a report card and 850 being the highest which would be an ‘A’ or distinction in your report card.

“It is also used amongst other criteria to determine the interest rate, you will be charged if a lender decides to approve the credit line or loan.

“It is a numerical expression based on a level of analysis of an individual’s Credit Report and is used to represent how risky it is for lenders or creditors to do business with said individual.”

According to him, “In developed economies, it is normal practice for creditors to consider credit scores and reports before advancing loans, goods or services to another party with the understanding that payments are to be made in the future.

“This practice is catching up in Nigeria, as there are more credit activities taking place in the financial and non-financial sectors.

“However, a lot of Nigerians do not know, that the credit scoring system does exist in Nigeria. It is until they need credit facilities like loans or post-paid products, that they are made to know about its existence and how important it is, to their financial lives and access to finance for both personal and business needs.

“The knowledge that both financial and non-financial institutions are using a number to determine if people living in Nigeria can access loans, credit facilities or post-paid services or not, is not common knowledge.”

He stated further that, “There is still a perception that loan granting is based on ‘Man know Man’ which is no longer the case at least for the average Nigerian.

“A poor credit score could mean paying sky-high interest rates on credit facilities or loans, if even approved at all. While a high credit score means borrowing money at a much lower rate because you appear more financially responsible.

“The CRC Score is powered by the Fair Isaac Corporation (FICO), an American company with over 50 years’ experience in data and analytics.

“CRC Credit Bureau in partnership with FICO developed a unique credit rating system for the Nigerian market that helps lenders make quick and informed credit decisions and for individuals’ knowledge of what their credit status is.

“The CRC Score powered by FICO is easily accessible to everyone and can be bought via the CRC Credit Bureau website for just Four Hundred Naira (N400.00) only.

“Knowing your CRC Score, makes you better prepared before applying for a loan and is the first step in taking control of your financial reputation.

“To request for your CRC score visit the CRC website page https://www.crccreditbureau.com/product/crc-score-individual to register and pay for Credit Score and have it delivered to your email address in a matter of minutes.”