On January 05, 2022, the Reserve Bank of India (RBI) released the eligibility criteria for entities to be categorised as ‘Specified User’ of Credit Information Companies (CICs). The eligible criteria are issued under clause (j) of Regulation 3 of the CICs (Amendment) Regulations, 2021.
- In November 2021, RBI notified CICs (Amendment) Regulations, 2021 to amend the CICs Regulations, 2006.
Eligibility criteria:
i.A ‘specified user’ should be a company incorporated in India or a Statutory Corporation established in India.
ii.Experience: In case the entity is a company, it should have not less than 3 years of experience in running the business/activity of processing information for the support or benefit of credit institutions and shall have a clean track record.
iii.Networth: The company should have a net worth of not less than Rs 2 crore as per the latest audited balance sheet, and should meet the requirement on a continuing basis.
iv.The company should be owned and controlled by resident Indian citizens/Indian company owned and controlled by resident Indian citizens.
v.The ownership of the company shall be well diversified. This condition will not apply to the holding of shares or voting rights by the Central Government/State Government/Central or State Public Sector Units.
vi.The entity should have a certification from a CISA (Certified Information Systems Auditor) certified auditor that it has a robust and secure information technology (IT) system in place for preserving and protecting the data relating to the credit information.
vii.The company, its promoter(s) and director(s) should not have been convicted of any offence involving moral turpitude or any economic offence.
Note – The entities that are meeting the above-mentioned criteria are allowed to apply to the CICs for obtaining the membership of CICs as a Specified User. The current initiative will enable more entities to become eligible to tap into information with CICs.
About Credit Information Companies (CICs):
i.Currently, there are 4 CICs — Credit Information Bureau (India) Ltd (CIBIL), Equifax Credit Information Services Pvt Ltd, Experian Credit Information Company of India Pvt Ltd and CRIF High Mark Credit Information Services Pvt Ltd.
Functions:
ii.Along with the business of credit information, a CIC will also provide credit information to individual and corporate borrowers’ own credit reports and also provide data management services to its member’s Credit Institutions.
iii.CIC will also collect, process, collate and disseminate data/information related to property mortgaged to credit institutions and investments made in Securities other than those issued by Central Government.
