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Equifax Credit Information Services is planning to launch nine new products, including those which will help banks to actively manage their credit portfolios and alert them about identify thefts, over the next 18 months in India.
The credit bureau, which is a joint venture between the US-based information solutions company Equifax and three banks – Bank of India, Union Bank of India, and Bank of Baroda – and non-banking finance companies – Kotak Prime, Sundaram Finance and Religare Finvest Ltd – has over 100 members currently and over six crore records. It became operational in September 2009. Speaking to Business Line , Mr Bhatia said that in India credit reporting lacks depth of products. For instance, in the US, Equifax has over 800 products.
How it works
Equifax's product for active portfolio management is currently being tested by a few banks. This product will alert the bank if a customer becomes more leveraged, i.e., if he or she tries to seek additional loans, the system will generate alerts.
Suppose a customer has taken a home loan from a particular bank and is consistent with repayments. Later on, the customer goes in for a car loan or a personal loan from another bank. This credit reporting product will alert the bank about the changing leverage levels of the customer. The bank can then accordingly offer either more products to the customer or review the existing credit limits.
“Such a product would have helped banks manage their portfolios better during the credit crunch two years ago,” Mr Bhatia said. Segmentation for portfolio management is also possible. This is aimed at helping banks compare data across different geographies and different kinds of products. For instance, how the auto loan segment is performing in one particular district.
Currently, Equifax provides lenders with credit reports and scores for consumer loans like mortgages, auto loans, personal loans, credit cards and so on.
Equifax is in talks with MFin, the umbrella body of NBFC-MFIs, to set up a credit bureau for the microfinance segment, Mr Bhatia added.
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