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Getting credit: The importance of registries
Author: Doing Business
Publication: Doing Business 2015
Overview

  • Doing Business has expanded its measures of the legal rights of borrowers and lenders and the sharing of credit information. They now also cover the functional approach to secured transactions, more features of the collateral registry and the availability of credit scores and online access to credit information.
  • A functional approach to secured transactions provides transparency and predictability for creditors—because the legal framework covers all rights in movable assets that secure the performance of an obligation, regardless of the type of transaction. Forty-seven of 189 economies have a functional approach as recorded by Doing Business.
  • A modern collateral registry—centralized, notice-based and allowing online access—is important. Among 189 economies, 18 have such a registry, while 25 have a notice-based registry and 28 an online registry.
  • Credit bureaus or registries offering online access can provide faster service and better data quality. Online access is available in 119 of 126 economies with a functioning credit bureau or registry covering at least 5% of the adult population as recorded by Doing Business.
  • Credit scores based on credit bureau or registry data provide highly predictive measures of a borrower’s future repayment capacity and so can help expand access to finance. They are offered in 64 of the 126 economies with a functioning credit bureau or registry covering at least 5% of the adult population.