RBI to set up digital Public Credit Registry

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The Reserve Bank of India has initiated the process to set up a digital Public Credit Registry to capture all the details of borrowers, including wilful defaulters and also the pending legal suits in order to check financial delinquencies.

The public credit registry will also include data from entities like market regulator SEBI, the corporate affairs ministry, Goods and Service Tax Network and the Insolvency and Bankruptcy Board of India to enable the banks and financial institutions to get a 360-degree profile of existing and prospective borrowers on a real-time basis.

The Public Credit Registry or PCR is a digital registry of authenticated granular credit information. It will work as a financial information infrastructure providing access to various stakeholders and enrich the existing credit information ecosystem.

It would be the single point of mandatory reporting for all material events for each loan, notwithstanding any threshold in the loan amount or type of borrower.

Key Highlights

The Reserve Bank has invited expression of interest (EOI) for developing the registry from companies with a turnover of over Rs 100 crore in the last three years.

Currently, there are multiple granular credit information repositories in India, with each having somewhat distinct objectives and coverage.

Within the RBI, CRILC is a borrower level supervisory dataset with a threshold in an aggregate exposure of Rs 5 crore.

Besides, there are other four privately owned credit information companies (CICs) operating in India.

The RBI has mandated all its regulated entities to submit credit information individually to all four CICs.

As per the EOI, the proposed solution should allow easy integration with ancillary information sources, like the Ministry of Corporate Affairs, Sebi, GSTN, CERSAI, utility billers, Central Fraud Registry and Wilful Defaulter/Caution/Suit Filed Lists.

Besides, borrowers would also be able to access their own credit information and seek corrections to the credit information reported on them.

The setting up of the Public Credit Registry is a significant move, as it comes amidst rising bad loans in the financial system.

The non-performing assets in the banking system amount to about Rs 10 lakh crore.

Background

In June 2018, the RBI had announced to set up a PCR for India with a view to address information asymmetry, foster access to credit and strengthen the credit culture in the economy.

Earlier, a high-level task force (HTF) was constituted by the RBI to review the current availability of information on credit, the adequacy of the existing information utilities and identify gaps that could be filled by a PCR.

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