174 subscribe to credit registry system

BY MISHMA CHAKANYUKA

THE credit registry system posted an increase in subscriber numbers to 174 subscribers in the period ended June 30, 2019 from 162 subscribers recorded in September, 2018, the central bank has revealed.

In the 2019 mid-term monetary policy statement, Reserve Bank of Zimbabwe (RBZ) governor, John Mangudya said the 174 subscribers comprised of 18 banking institutions, 152 Micro Finance Institutions (MFIs), the Depositor Protection Corporation and three non-banks.

“Total subscribers as at 30 June 2019 were 174, from 162 as at 30 September 2018, comprising 18 banking institutions, 152 MFIs (including SMEDCO), the Depositor Protection Corporation and three non-banks. Credit registry usage levels by subscribing institutions increased steadily to a cumulative 566 298 reports as at June 30, 2019,” Mangudya said.

“The credit referencing environment continues to improve against the background of increased coverage for the credit registry and credit bureaus, as well as depth of credit information. As at 30th June 2019 the credit registry held 1 044 538 records, of which 525 967 were active loan accounts. Individual records represented 98,4% of the active loan records.”

The credit registry was established to profile the credit history amid revelations that there were multiple borrowers who were defaulting on loan repayments.

Mangudya said the RBZ implemented value-added products aimed at facilitating in-depth analysis of credit data for risk management and policy-making purposes, in a bid to augment efficiency of the credit registry.

At the peak of the registry system, the non-performing loans (NPLs) ratio was 20,45%, raising fears that banks would cut back on lending.

Mangudya said the quality of the banking sector loan portfolio continued to improve, driven by a decline in NPLs to total loans to 3,95% as at June 30, 2019 from 6,92% as at December 31, 2018.

“The improvement in the NPLs ratio was a result of a combination of an increase in total banking sector loans and advances coupled with a 30% decrease in the total non-performing loans from $348.83 million as at 31 December 2018 to $243.78 million as at 30 June 2019,” he said.

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