CIBIL: "Round up the usual suspects"

So CIBIL and the other CIB's can "circulate" credit information without the consent of borrowers? Well this blogger will certainly have to approach the superior judiciary once his Hacking Complaint is disposed off.

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The recently-passed Credit Information Companies (Regulation) Bill, has formalised the credit data-sharing efforts already under way with the establishment of CIBIL in May last year. Banks and finance companies hold equity in CIBIL. This effort may change the face of credit risk management finds Minna Kumar of Sify Finance.

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The recently-passed Credit Information Companies (Regulation) Bill has legitimised the credit data-sharing efforts already under way with the establishment of Credit Information Bureau (India) Ltd (CIBIL).

Since the inception of CIBIL in May 2004, banks have been awaiting a new law that would allow them to share credit information of a borrower without seeking his consent. So far, banks had to obtain permission from borrowers before sharing information with the bureau. The premise of setting up CIBIL was to minimise non-performing assets that were plaguing the banking industry for the past decade.

CIBIL, works on the principle of reciprocity. Only those members who provide data will have access to information from CIBIL.

The Bill now makes it mandatory for every credit-providing institution in the country to report to at least one credit information company such as CIBIL about personal information on borrowers and their transactions including, but not limited to the amount, repayment history and default status.

The Bill covers a wide array of secured and unsecured credit schemes including personal, home and vehicle loans, leasing and hire purchases, credit cards, bank guarantees and letters of credit.

The ownership of CIBIL was till recently broad-based. Its equity was held by State Bank of India, Housing Development Finance Corporation Limited, Dun & Bradstreet Information Services India Private Limited and Trans Union International Inc. The shareholding pattern was in the proportion of 40:40:10:10 respectively. SBI and HDFC have now divested 23.75 per cent stake each. Nine new investors including ICICI Bank, Punjab National Bank, HSBC, Citibank and Sundaram Finance have stepped in.

This follows Reserve Bank of India's statement in the annual Monetary and Credit Policy 2004-2005 that credit bureaus should have a sufficiently diversified ownership. RBI wants the ownership to be shared among lenders as the bureau will collect and disseminate sensitive credit information pertaining to an individual or a business. This also brings in more direct participation from financial institutions.

Under the new shareholding structure, ICICI Bank would hold 10 per cent stake with a position on the board of directors. PNB, Bank of India, Central Bank of India, Union Bank of India, Bank of Baroda, Citibank and HSBC would hold 5 per cent stake each and Sundaram Finance would have 2.5 per cent stake. SBI and HDFC will now hold only 16.5 per cent each.

CIBIL has two streams - the consumer bureau, comprising information of individual borrowers in respect of credit cards, home loans and personal loans. It also has a commercial bureau where banks share information of corporate clients in the near future.

The credit report from CIBIL would indicate, how much the individual has borrowed and what his/her repayment history has been. This is expected to mitigate credit risks, enable speedier and more objective credit decisions by banks.

The concept can be very effective in controlling non-performing assets of banks. The law covering the operation of credit bureaus like CIBIL will change the face of risk management in the country. However, some questions remain unanswered. For example, what is the legal responsibility of credit bureaus, lenders and the government in informing and educating the consumers about how their personal information is used and what rights they have?

With a series of mishaps reported from the US, particularly the theft of information from the Bank of America in recent months brings on a whole new shade to this process. It appears to be the responsibility of lawmakers to ensure the safety of information.

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The Usual Suspects:

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Santhanakrishnan(Chairman)
S Santhanakrishnan is the Executive Chairman of CIBIL. Mr. Santhanakrishnan joined CIBIL in December 2004. He is the Chief Executive Officer of the Company. Mr. Santhanakrishnan has over 36 years of banking experience with State Bank of India (SBI) where he retired as Dy. Managing Director and Corporate Development Officer (DMD & CDO).
Tel: +91-22-56384680 Fax: +91-22-22840571 Email: sskrishnan@cibil.com

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Arun Thukral (Chief Operating Officer)
Arun Thukral is the Chief Operating Officer of CIBIL. He joined CIBIL in March, 2005. At CIBIL he is responsible for the operations of the Company.
Mr. Thukral is a post graduate from the University of Delhi and has a diploma in Sales and Marketing from the Faculty of Management Studies, Delhi University. He has over 27 years of experience and has worked with Hindustan Lever Ltd., Blow Plast Ltd., UB Group and his last assignment was with Dun & Bradstreet as Regional Director.
Tel: +91-22-56384675 Fax: +91-22-22840571 Email: arun@cibil.com

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Sudesh Puthran (Senior Vice President - Information Technology)
Sudesh Puthran is the Senior Vice President - Information Technology of CIBIL and leads the Technology Team for implementation of state of the art Information Technology solutions for CIBIL. His primary role is to setup the Data Centre and implement IT solutions and operations for CIBIL.
Mr. Puthran has more than a decade of experience in Information Technology. His last assignment was as Chief Technology Officer at CRISIL, India where he had built fully automated end-to-end workflow solutions for various business processes.
Mr. Puthran also teaches in some of the management schools in Mumbai University in the area of Information Technology.
Tel: +91-22-56384642 Fax: +91-22-56384666 Email: sputhran@cibil.com

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P R Viswanathan (Vice President - Marketing)
P R Viswanathan is the Vice President - Marketing of CIBIL and is responsible for customer interface.
Before joining CIBIL, P R Viswanathan was working with BNP Paribas as General Manager, Chennai and was later posted in February 2001 as Head - Financial Institutions Group at Mumbai.
Prior to BNP Paribas, he was at State Bank of India (SBI). He joined SBI as Probationary Officer in 1974 and worked on various assignments till 1998 - primarily in the areas of credit and foreign exchange. He was Assistant General Manager when he retired voluntarily in September 1998.
Tel: +91-22-56384660 Fax: +91-22-56384666 Email: prv@cibil.com

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Haren Parekh (Vice President - Finance)
Haren Parekh is the Vice President - Finance of CIBIL and is responsible for the overall Finance, Accounting and Administration of the Company. He is also in charge of the HR and Secretarial functions of the Company. He joined CIBIL in May 2002.
Before joining CIBIL, Haren Parekh was working with Hindustan Oil Exploration Company Ltd (HOEC) as Deputy General Manager and has more than 18 years post qualifications experience looking after Treasury operations of HOEC and also various business development activities of the Company. He was part of the Management Committee of the Company. Mr. Parekh was also a director in HOEC Bardahl India Ltd., which is a subsidiary of HOEC.
Earlier he practised as a Chartered Accountant.
Tel: +91-22-56384646 Fax: +91-22-56384666 Email: haren@cibil.com

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Mr.Haren Parekh is my all time favourite contact person at CIBIL. I wish that I could post the rejoinders that CIBIL has made to my Complaint on this BLOG -- too bad that I can't since then I could be sued-- the rejoinders are well drafted, factual and professional. Quite unlike those Standard Chartered Bank clowns :-)