Factual credit information leads the way in assessing consumers’ creditworthiness which will effectively see the end of blacklists, said a top official of Saudi Credit Bureau (Simah).

A recent study on payment behaviour conducted by Simah in 1,000 defaulters found that 46 per cent borrow from their friends to pay their loans, while 27 per cent notify the lenders of their inability to reimburse the settlement.

These findings are revealed as Simah prepares to host the ninth world consumer credit reporting conference (WCCRC) on October 20 at the Dubai Grand Hyatt Hotel.

Simah, which plays an important role in promoting financial discipline, superior credit risk management and making prudent lending decisions, has stressed that the bureau has no form of lists to assess consumers’ creditworthiness.

Simah CEO Nabil Al-Mubarak said: "We are a neutral credit bureau that provides credit information reports according to the Credit Information Law and Implementing Regulations. We can confirm that the era of the black list ended in 2004 and the new assessment strategies from Simah provide more transparency in the credit market."

"As a result, consumer’s positive credit history is increasing which allows them to access more credit facilities," he noted.

“Simah seeks to help its members provide consumers with diversified and unlimited financial services including all kinds of credit facilities with less costs and guarantees. It also aims to help creditors to take better and faster decisions, reduce non-payment risks, and help consumers to benefit from their credit histories at less commission and easier conditions,” he added.

Simah’s study revealed that 80 per cent of total defaulters own cars manufactured after 2000, with 36 per cent buying their cars in cash, 31 per cent in instalments and four per cent by loans.

Just less than 50 per cent of defaulters admitted that their spending is affected by banks’ promotional advertisements.
 
The report also assessed the behaviour of tourists’ payments, finding that 73 per cent of defaulted tourists tend to travel abroad, with 69 per cent of those defaulted tourists preferring to pay cash, 26 per cent on credit cards and 4 per cent in traveller cheques.

Organised bySimah, the Association of Consumer Credit Information Suppliers (ACCIS) and the Consumer Data Industry Association (CDIA), the two-day summit will discuss a number of topics, including the growth of the credit bureau in the GCC region, the US and the EU data reporting standards and the latest trends in fraud and tools being used to prevent fraud and identity theft.-TradeArabia News Service