Banks must share default data: Reddy

MUMBAI: Reserve Bank of India governor Y V Reddy yesterday told bank CEOs to share data on defaults with the Credit Information Bureau of India (CIBIL), failing which the regulator may slap penalties.

A few large banks have not transferred their data to the bureau, causing roadblocks in the functioning of the bureau, which is expected to help banks better price their products on the back of customer information. Customers with a better credit profile would be benfitted as banks are likely to charge them lower rates.

The bureau currently has a database on the credit history of over 8 million individual consumers from various banks, financial institutions and non-banking finance companies. Currently, around 17 banks have shared their data with CIBIL. More banks are likely to follow but there have been delays.

CIBIL has a Rs 25-crore capital, and is jointly promoted by State Bank of India and HDFC with both holding 40% each, while Dun & Bradstreet and Trans Union International hold 10% each.

This would be the first credit bureau in the country which contains the complete information of the customer. It had launched the Consumer Credit Bureau (for data on retail loans and credit card) some months before.

However, a senior private sector bank official who has already submitted the data said, "There are technical issue as the data has to be submitted to CIBIL in a particular format and in a particular software."