CIC Defines Credit Data’s Role in Improving Women’s Access to Finance; Cites Initial Views of Gender Contrasts in Credit Use

Credit Information Corporation (CIC), the country’s central credit registry and repository of Filipinos’ credit information, presented the CIC Credit Report as a tool for improving women’s access to credit during the first webinar on women’s economic empowerment organized by the University of the Philippines Public Administration Research and Extension Services Foundation, Inc. – Regulatory Support Program for National Development (UPPAF-RESPOND).

Carried out in partnership with the Philippine Commission on Women (PCW), the said webinar is the first in the Women’s Global Development and Prosperity (W-GDP) series of UPPAF and focused on tackling how having a data footprint, like the CIC Credit Report, helps address the issues and concerns faced by women micro-entrepreneurs (WMEs), especially in the time of COVID-19.

“One of the challenges of smaller enterprises and starting entrepreneurs when looked from a gender perspective is establishing credit footprint,” CIC President and CEO Jaime Casto Jose P. Garchitorena, who served as the webinar’s main speaker, shared. He also illustrated how a spouse, when running a home-based business, can be disadvantaged when it comes to providing proof of revenue in order to get credit: “Using the stereotypical model where the spouse at home is the woman, she has no proof of revenue since she manages a small business from home. On the other hand, the male spouse—who may be earning less—has pay slips, employment records, and TIN, SSS, and GSIS numbers. From a data perspective, the male spouse has the advantage. ”

Credit applications, risk mitigation amid COVID-19 The CIC PCEO further elaborated on how WMEs can begin establishing a credit footprint.

“Normally, building a credit footprint can be done through a low-value credit card or start it with your microfinance institutions (MFIs). Even when initially used as a means to increase your consumer spending, this credit footprint will follow you through your entrepreneurial cycle. The need for credit is constant, whether you want to start, sustain, or grow your business. Additionally, the more credit history you have, the less collateral you will need,” Garchitorena explained.

This is where the CIC Credit Report, which contains both positive and negative credit data of the borrower, comes in.

For Toyota Financial Services (TFS) Philippines—one of CIC’s accessing entities—existing credit information translates to efficiency in processing a borrower’s loan application and immediate credit decision.

“When we can match you to a CIC Credit Report, our cost for credit investigations go down. And when that report tells us that you have a good financial record, it allows us to offer you additional benefits such as promos, lower down payment, or even payment holidays,” TFS Department Head of Sales Administration, Ms. Hazel Tan Lopez, shared as one of the webinar reactors.

Tan Lopez also attested to the benefits of the CIC Credit Report to lenders, especially on risk mitigation: “Putting together the credit information from the CIC and other data sources we may have vis-a-vis our company’s credit parameters, makes it easier for us to gauge the creditworthiness of our borrowers and allows us to serve our customers better.”

Meanwhile, UnionBank of the Philippines—the first universal bank to access the CIC database—uses both traditional credit assessment and data analytics in lending to retail, small, and medium enterprises.

“What are the common concerns of the borrowers when it comes to making their businesses thrive during this pandemic? It’s still having that available information, whether in their credit history or, if you’re new to credit, alternative sources like utility bills. These are the information that we look at to be able to profile the customer accordingly,” Ms. Rhani Rull-Svenningsen, UnionBank’s Head of Credit Risk for Retail and SME and also one of the webinar reactors, stated.

Gender differences in credit access

The CIC PCEO likewise presented some CIC statistics in terms of gender and lenders: “From the initial drawing of data, the best lenders in terms of number of female borrowers versus number of male borrowers seem to be microfinance with number of loans favoring women with 87%, with male borrowers showing 13%.”

“This is still raw data, but this illustrates how the CIC can be a source of statistical and behavioral data that can help craft more relevant and meaningful policies to support the cause of women and their access to credit in the future,” he continued.

Garchitorena also expressed CIC’s commitment to validate the numbers in order to determine whether the gender differences in credit use may be considered a policy, accessibility, opportunity, or educational issue: “For example, initial drawings show that 59% are female and 41% are male, so it seems that there is almost equal access to credit for both genders. But according to our records, the average loan for female is PhP605,000.00 and the average for male is PhP1.1M. That’s interesting and we’d have to verify that. But if the discussion point is equality versus equitability, that’s the kind of narrative CIC data can validate.”

In closing, Ms. Jeanne Illo, the UPPAF RESPOND gender specialist who also served as the forum moderator, stated how the organization promotes the Philippine government’s twin goals of gender equality and women’s empowerment. “UPPAF’s W-GDP Program focuses on enabling women by removing restrictive, regulatory barriers; this is an advocacy issue that UPPAF shares with both the CIC and PCW,” Illo told the approximately 300 participants who attended the webinar on 28 August.

Also present were Dr. Enrico Basilio, UPPAF RESPOND’s Chief of Party, who officially opened the webinar; Ms. Carmen Lopez, OIC-Project Manager of PCW’s Great Women Project 2, who shared highlights of the online survey they conducted with WMEs; and Ms. Joji Pantoja, CEO of Coffee for Peace Inc. and Ms. Thea Rimando-Sy, COO of Dieu Illemete Food Inc. who both joined as reactors. Atty. Kristine Yuzon-Chaves, PCW Executive Director, delivered the closing remarks.

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The Credit Information Corporation (CIC), a government-owned and controlled corporation, was created by Republic Act No. 9510, otherwise known as the Credit Information System Act (CISA). The primary mandate of CIC is to establish a comprehensive and centralized credit information system for the collection and dissemination of fair and accurate information relevant to, or arising from, credit and creditrelated activities of all entities participating in the ecosystem.