South African businesses and individual credit-seekers stand to benefit from a recent announcement by the National Credit Regulator.

Compuscan has recently been selected by the National Credit Regulator (NCR) as one of only three primary data hosts for the National Loans Register (the NLR).

According to analysts, the more data types or data sets hosted by credit bureaus, the greater the economic benefit for businesses and individuals. The advent of the National Credit Act mandated comprehensive affordability studies of all credit-seekers, meaning accurate updated data is needed to ensure credit is extended to all users fairly and that lenders' risks are minimised.

The NLR is a vital source of both positive and negative credit information since its inception in 2000. The NLR maintains details of all applications for micro loans. It also contains account and repayment information of loans granted by micro lenders registered with the National Credit Regulator as well as identification and contact information. The NLR currently holds records of approximately 32 million registered accounts. It hosts data arising from an increasing number of micro-loan accounts, at the rate of approximately 5 million per month. Repayment details of millions of micro loan accounts are uploaded on a daily basis.

The emergence of a formal and regulated micro lending industry has benefited hundreds of thousands of South Africans who previously enjoyed only limited access to loan finance. This assists development both at an individual household level and is essential to stimulate small business development.

This, against a continuing backdrop of declining credit records among consumers nationally, makes the need for comprehensive credit checks an urgent necessity, especially in the micro lending market.

Growth in all consumer credit transactions since the final quarter of 2009, especially short term, is reflected in the NCR-sponsored March 2010 Consumer Credit Market Report. The quarter-on-quarter growth in the short-term sector was the highest at 15.3%, reflecting the role of micro lending. At the same time, Econometrix reports that credit infringements leading to adverse listings and impaired records has increased during the period under review.

According to Compuscan's CEO, Remo Lenisa, his company’s newfound status as a primary supplier of NLR data places it on par with its two major competitors and directly benefits credit provision sectors, particularly the micro lenders. “We are extremely pleased at this achievement. This is something we have been aiming for over a number of years. Ironically, we have been the largest supplier of NLR data in the industry for at least 10 years, but have only enjoyed second tier provider status to our clients” he says. “A big benefit to our clients and to the market generally is that we can now provide more complete and comprehensive data sets - a one-stop shop for clients. Carrying out the data processing and analytics in-house, means that Compuscan data is also more up to date than other offerings in the market. This, with scoring of the updated data, means improved scorecards and hence for clients more powerful credit-granting decisions.”

Currently, full credit information that includes the NLR is available to South African lenders from 3 bureaus only. The award of primary NLR data provider status to Compuscan signals more competition in the upper end of the market and hence more direct benefit to the supplier of credit to the SA market.

Should you require more information, please do not hesitate contact us at Tel: 021 888 6000 or e-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it . You can also visit our website at www.compuscan.co.za