The document discusses regulatory and business issues related to credit bureaus in East and Sub-Saharan Africa. It notes the low penetration of private credit bureaus in the region as well as a lack of credit account data. While some countries have improved their credit information systems in recent years, issues still include weak regulatory frameworks, economic challenges to viability, lack of reliable data, poor information technology infrastructure, and skills shortages. Potential solutions proposed include using biometric identifiers, a hub-and-spoke model, broad consultation, and training programs.

1. Regulatory and Business Issues at Play in the East
and Sub-Saharan Africa Region
Frank Lenisa
Marketing Director
Compuscan
23 October 2012

2. Least Developed Credit Bureaus in the World
Penetration rate of private bureaus (% of adults)
Doing Business, 2012
Frank Lenisa
October 23, 2012 Page 2

3. Low Number of Credit Accounts
Country Population (million) No of credit accounts
(estimated)
Mozambique 15 120 000
Angola 20 200 000
Tanzania 46 1300 000
IFC, 2008
Frank Lenisa
October 23, 2012 Page 3

4. Credit Reporting is Developing
Doing Business 5 year overview
Country Depth of credit Getting credit rank
information index
(0-6)
Kenya Remained at 4 From 13 - 8
Tanzania Remained at 0 From 115 - 98
Zambia From 0 - 5 From 97 - 8
Ghana From 0 - 3 From 115 - 48
Uganda From 0 - 4 From 158 - 48
Rwanda From 2 - 6 From 158 - 8
Doing Business, 2008 - 2012
Frank Lenisa
October 23, 2012 Page 4

5. Regulatory and Business Issues
 Regulatory framework
 Economic viability of credit bureaus
 Lack of data and unreliable data
 Information technology
 Skills and knowledge
Frank Lenisa
October 23, 2012 Page 5

6. Regulatory Framework
 Bank secrecy provisions limit participation of credit
bureaus
 Credit market is not competitive; banks have no
incentive to share information
 Reforms needed to mandate information sharing
 Bureau supervision agencies constrains the use of
alternate credit data
Frank Lenisa
October 23, 2012 Page 6

7. Economic Viability of Credit Bureaus
 Small sized credit markets
 Difficulty to achieve economies of scale to lower
operating costs
 Operating costs are high in the region
 Profitability can take many years
Frank Lenisa
October 23, 2012 Page 7

8. Lack of Data and Unreliable Data
 Lack of location identifiers
 Interchangeable, unreliable individual naming
 Lack of unique identifiers
 Poor credit granting practices
 Manual based processes
Frank Lenisa
October 23, 2012 Page 8

9. Information Technology
 Data extraction from banking platforms affects
data quality
 Lack of information technology investment and
management especially by MFIs
 Electricity supply constraints and expensive
 Problematic telecommunications and expensive
 Problematic hardware supply, support and
expensive
Frank Lenisa
October 23, 2012 Page 9

10. Skills and Knowledge
 Poor practical application of knowledge
 High number of job applicants
 Language barriers
 Lack in understanding of general credit
reporting principles
 Stakeholders lack collaboration
Frank Lenisa
October 23, 2012 Page 10

11. Possible Solutions
 Biometric and smart card technologies
 Hub and spoke approach
 Broad consultation and thorough research
 Phased approach to bureau implementation
 Training for all stakeholders
Frank Lenisa
October 23, 2012 Page 11

12. About Compuscan
 Established in 1994
 Headquarters in Cape Town
 Full service credit bureau
 Wide range of value adding
products and services
 Representation in 5
countries in region
Frank Lenisa
October 23, 2012 Page 12

13. Thank you for your time
Any questions?
Frank Lenisa
+2782 920 0455
frank@compuscan.co.za
www.compuscan.co.za
Find us on:
Frank Lenisa
October 23, 2012 Page 13