A question about a certain black list allegedly compiled in the country’s main bank and kept in a secret red file superscribed “The Debtors” is among the most frequently asked questions processed by the specialists of the National Bank’s Contact Center. The citizens of Belarus, who have taking out a loan on mind, are agitated: the rumor mill says that the National Bank plays the part of a borrower supervisor and makes decisions to whom a loan may be allocated and whose request should be rejected. This is a myth of course, fed by the fact that the Belarusians are incompetent in the system of credit histories and reports, and diabolize the National Bank. So let’s take a close look at what information and why is kept by the Credit Register Department of the National Bank of the Republic of Belarus.
Let’s make sense of the definitions.
A loan transaction means a loan agreement, overdraft lending agreement, borrow or pledge agreements, and also a deed of guarantee or suretyship agreement, signed by and between the customers and the banks. After making such transactions you act as a borrower, loan debtor, pledger, guarantor or surety. Acting in any named capacity, you sign an agreement with the bank and in doing so you enter into legal relations with it and become a source of credit history development. Such information is sent to the National Bank where the respective credit history is formed to become an efficient tool for assessment of the customer’s repayment discipline by the bank.
A credit history means information which characterizes the subject of such credit history and fulfillment by the same of his obligations assumed under loan agreements. Such data is kept in the Credit Register of the National Bank. A credit report means a document which contains information formed by the National Bank on the grounds of data included in the credit history.
Information on any signed agreements and fulfillment of obligations under such agreements, to be included in the respective credit history, should be submitted to the National Bank within 10 days from making an operation. Such information is updated in the online mode; so as soon as the bank sends information to the National Bank such information appears in the credit history in next to no time.
The credit history of a customer who is a natural person contains the following:
- general information (name, given name, patronymic; identification number; date of birth; citizenship; place of residence);
- information on the signed agreements (the bank with which such agreement was signed; number and date of the agreement; amount and currency of the agreement; repayment period);
- data on fulfillment by the customers of their respective obligations to the bank under given agreements (history of loan repayments; late payment on a loan or overdraft or borrowing; default curing; data on fulfillment of pledge agreements, deeds of guarantee or suretyship agreements).
The National Bank processes such incoming data on loan agreements, compiles and maintains credit histories in its Credit Register. The central bank submits data from the Credit Register in the form of credit reports to the parties entitled to be disclosed such information.
The law says that banking secrecy is the main principle of formation of credit histories and submission of credit reports. Only courts, law-enforcement agencies, and other persons in certain cases stipulated by the legislation may request any credit report without consent of the subject of a certain credit history.
The National Bank of the Republic of Belarus does not maintain any so-called black lists inclusion into which means impossibility of taking out a loan. Prohibition on lending is not mentioned anywhere directly or indirectly. Every bank makes a decision on lending independently, based on information contained in the credit history. The banks which allocate loans to their customers develop their own criteria of credit history assessment. As a general rule, an application for credit is turned down if a person has a long-term loan delinquency to a large amount.
Information on late payments is deleted from the credit history at the lapse of 5 years after repayment of debt, whereas outstanding amounts will be kept in the credit history for 45 years.
May one learn his credit history?
Information contained in the credit history is very simple to obtain. To do so, one should only enquire with the National Bank. The credit report is submitted free of charge once within a calendar year. The quantity of requests is unlimited, however all subsequent requests are paid.
In Minsk, requests for credit history should be filed with the Credit Register of the National Bank. In the regions, such credit reports are submitted by the central administrations of the National Bank operating in all regional centers.
Is it allowed to obtain the credit history of a close relative?
The credit history may be submitted either to the subject of such credit history or his/her proxy on the grounds of a notarized power of attorney. Information contained in the credit history may not be disclosed by phone; only personal attendance is required.
How to change one’s credit history?
Changes may be entered in the credit history only if it contains erroneous data. Should this be the case, apply to the bank with which an agreement has been signed, or file the request for entering changes in the credit history directly with the National Bank. Time for consideration of such request is one month.
For example, if the date of agreement termination or loan repayment under the agreement actually performed by the customer is not recorded in the credit history, the bank must both issue to a customer a certificate confirming the absence of loan debt and also submit such information to the customer’s credit history.
The credit report requested by the customer after changing inaccurate information is submitted free of charge.
People often ask the National Bank whether it is possible to make a note in the credit history, stating that their certain relative may not be given a loan if such relative abuses alcohol or is mentally deficient or has never repaid loans taken out before, or for other reasons. We want to reiterate that the National Bank places no marks in the credit history meaning a ban on lending to a certain natural person, in particular enters no notes concerning legal incapacity or mental deficiency or similar. According to Articles 29, 30 in the Civil Code of the Republic of Belarus a person shall be deemed legally incompetent or partially incapacitated in cases provided by the legislation from the date when court decision has come into legal force.
So the National Bank is not entitled to restrict one’s rights provided by the legislation of the Republic of Belarus.