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Rolle: Manage your credit exposure, keep up with your debt payments

Governor of The Central Bank of The Bahamas (CBOB) John Rolle said Bahamians should prepare for the introduction of a credit bureau by managing their credit exposure and keeping up with their debt payments.

Rolle explained that the biggest risk to borrowers is unexpected events that require them to rely on savings or more debt for recovery.

“Even if you are consistent making your payments, depending on the amount of debt you carry, one of the greater risks that households face, is you have unexpected events that require you to dig into your savings or take out additional debt to cover those situations,” he said.

“So, having a comfortable level of debt is also protecting yourself against those surprises, as well as providing a comfort to financial institutions that if those sorts of surprises come up, you can get through those without any adverse outcome.”

Rolle said people should focus on keeping their debt burden within manageable limits. He also suggested borrowers reveal their true debt exposure to financial institutions.

He added that some households have debt outside of the commercial banks that exacerbate their inability to fulfill their obligations to those lending institutions.

“The expectation is that you have to go through some amount of adjustment, but it shouldn’t be looked at as a bad thing,” Rolle said.

According to him, with the introduction of the credit bureau people will be in a better position to be seen as a quality borrower and garner better interest rates and terms, while the credit bureau will give other individuals an opportunity to build up a track record of good credit.

“Anyone will be able to demonstrate that they are a high quality borrower,” he said.

Rolle said the credit bureau operator is expected to go through a licensing process before the end of 2019 and begin to have credit information that is accessible for use in about two years.

Chester Robards

Senior Business Reporter at The Nassau Guardian
Chester Robards rejoined The Nassau Guardian in November 2017 as a senior business reporter. He has covered myriad topics and events for The Nassau Guardian.
Education: Florida International University, BS in Journalism
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