Federal credit bureau significant step for UAE economy, says DED

The Dubai Department of Economic Development (DED), hailed today the UAE Ministry of Finance’s (MoF) study for creating a federal credit bureau as a significant step in fostering a conducive environment for prudent lending decision-making across industry sectors in the UAE. In early 2006, DED established Emcredit, the UAE’s first government-backed credit information services company, to offer credit reporting services in the UAE.

Mr. Ali Ibrahim, Deputy Director General at DED, and Managing Director of Emcredit, said that a federal credit bureau will bring confidence to all stakeholders in the credit reporting industry, and strongly facilitate the sharing of credit information.

“The federal credit bureau coming into force will strengthen the UAE’s credit reporting infrastructure. Greater participation by banks will lead data coverage levels that will provide instant value through comprehensive credit reports,” said Ibrahim. “Emcredit has so far invested in building a robust technical infrastructure, developing multiple value-added product, services and credit reporting skills.”

Ibrahim added that under the current challenging global business environment, comprehensive credit information plays an especially vital role in supporting risk management in the UAE.

In its Doing Business Report 2010 recommendations to the UAE, The World Bank highlighted that “Emcredit’s operational experience, infrastructure, market penetration and existing relationship” will prove to be valuable in creating a federal credit bureau in the UAE.

Established in 2006, Emcredit has a rich database on individuals and companies in the UAE, including 5.6 million consumer identification records, payment behaviour information on consumer and commercial borrowers and 35 per cent of mortgage data in the UAE. It has established data-sharing agreements with several government departments, to power its information solutions. These government entities include Dubai e-Government, Dubai Police, Department of Economic Development (DED), Dubai Land Department and its subsidiary, the Real Estate Regulatory Authority.