RBI allows bank customers access to credit profile

The Reserve Bank of India (RBI), in its new ruling for credit information companies, has allowed bank customers to have access to their credit history maintained by credit information companies. Credit history comprises borrowers' loan repayment records and related information.

The borrowers will have to pay a nominal fee of Rs 100 to a credit information company. The apex bank has capped the maximum fee that a credit information company can charge from its specified users at Rs 500 for information on individual borrowers and Rs 5,000 for non-individual borrowers.

It has set a limit of Rs 15 lakh membership fee for institutions seeking registration with credit information firms.

In its new set of guidelines, the apex bank has extended the gamut of specified users of credit information to include the Securities & Exchange Board of India (Sebi) and the Insurance Regulatory and Development Authority (Irda), insurance companies and brokers registered with Irda and Sebi.

This also includes telecom services providers, rating agencies and trading members registered with a recognised commodity exchange.

For an individual wanting to procure information from a credit bureau about his records, the RBI has indicated that the credit information company must put in place suitable criteria to ascertain former's identity.

It has been necessitated that the company divulging credit information must update the records at least within 15 days after being requested by an institution or a specified user.

In case the specified user gets a report suggesting denial of extending credit to a prospective borrower, the RBI has asked companies to send the borrower a written rejection notice within 30 days of the decision.

The notice will also have to include the reasons for rejection along with a copy of the said credit information report, said RBI.

In addition, the central bank has asked user institutions denying credit, to provide the borrower the name of the credit information company issuing the report and any other information used in making the decision.