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Central Bank releases details of credit bureau RFP

Central Bank of The Bahamas.

The Central Bank of The Bahamas (CBOB) on Friday released the request for proposals (RFP) for the establishment and operation of a private credit bureau, which revealed that 90 percent of employed Bahamians are “credit active consumers”.

CBOB’s RFP calls for an initial stage bureau to process only the consumer credit market, with an extension to commercial credit reporting in the future.

The RFP calls for the successful party to come in with a cash investment in order to establish the credit bureau, and not to form the bureau based on software license agreements (SLA), development fees, service fees or any other related fees, items or assets.

“Capital must cover the costs of establishing and operating the credit bureau for at least the first five years,” the RFP explains.

According to the RFP, the successful company will be able to establish part of the bureau outside of The Bahamas. Necessary servers can be based at a “remote data center” elsewhere in the world.

“The Credit Reporting Act, 2018 allows for a local presence or an alternative ‘hub and spoke’ model, where the core platform resides outside of the territory of The Bahamas, leveraging shared services,” the bank states.

“In the event of a remote data center, a local sales and support office must be incorporated in The Bahamas under the Companies Act of 1992, to interact with the local banks and other credit information providers, to ensure consistent and accurate delivery of data, self-inquiry access and dispute resolution on a timely basis.”

According to the RFP, the country’s labor force is approximately 226,680, and with 90 percent of that workforce in some sort of debt and the country’s non-performing loans portfolio being extremely high, the credit bureau seems necessary.

The Credit Reporting Act was passed by Parliament in February and CBOB hopes to have two possible vendors shortlisted by June 29.

“The technical component of the RFP will be evaluated by an evaluation committee,” the RFP states.

“The evaluation committee will be comprised of one representative each from The Central Bank of The Bahamas, the Clearing Banks Association and the Bahamas Chamber of Commerce and Employers’ Confederation. The three-person committee will review all the RFP submissions and evaluate them on their individual technical merit.

“The prospective credit bureau operator must be capable of delivering a scalable and modular credit reporting system, which would allow for an appropriately priced state-of-the-art solution with the potential to be equipped with more sophisticated features in the subsequent phases of the credit bureau development and in line with the market needs of The Bahamas.

“To this end, The Central Bank of The Bahamas is inviting qualified credit bureau operators, with international experience in operating credit bureaus, in a manner consistent with internationally accepted credit reporting principles and industry standards in terms of reciprocity, confidentiality, privacy principles and consumer rights, and having the technical, managerial and financial capacity to operate a credit bureau, to submit proposals to establish credit bureau operations in The Bahamas.”

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