ABU DHABI // The Minister of State for Financial Affairs has promised that a credit-check system will be up and running by the end of the year, as FNC members pressed him to explain delays.
The FNC member Ali Al Nuaimi said Emiratis could not continue to rely on the country's rulers to pull them out of trouble, as the President did last December when he ordered the debts of almost 7,000 citizens be cleared.
At the centre of the credit-check system will be a new company that will share individuals' loan details between banks.
The company should have been set up after the passing of a law by the FNC in 2009, and by the President in 2010, but it still has not.
Mr Al Nuaimi demanded an explanation for the delay from Obaid Humaid Al Tayer, the minister.
"There is no shared information between banks," the member from Ajman said. "People go to a bank and they know the bank will not go back and check behind them.
"People come to banks, especially if the loan is less than Dh200,000, and the banks grant them the loan based on salary certificate but they don't know if they have debts in other banks."
The company will allow banks to access their customers' credit history with other banks, giving them the option to refuse further credit.
Mr Al Nuaimi said the lack of such a company was leading to Emiratis facing prosecution and expatriates fleeing the country.
He said Mr Al Tayer's previous written answer on the subject, presented last month, made no mention of when the company would start.
"That only answered what was going on but we found slowness in implementing the law," Mr Al Nuaimi said to the minister last week. "So when will we see this company?
"What are the steps the ministry will take to make sure they follow high standards from first day it commences?"
Mr Al Tayer said the delay was because the Government understood the importance of the company, and that it took time to ensure the regulations were right.
He said the Ministry of Justice had yet to check if the draft regulations were legal.
"The [finance] ministry has set aside the budget for the company. We have taken all our steps," Mr Al Tayer said. "We are establishing a very important government institution."
He said the company would be launched officially in the "next few weeks", but would then take six months to become fully operational.
"There are electronic things we need to do along with the Central Bank because they are the ones to oversee work of the company," he said. "We are hoping to do this soon but we must be realistic that it will take time."
Mr Al Nuaimi said expectations were high for the company.
"The banking sector is vulnerable to severe problems," he said. "We need to help people in society by spreading culture."
While he welcomed Sheikh Khalifa's decision to pay off some Emiratis' loans, Mr Al Nuaimi said nationals "cannot rely on being saved after drowning in debts every time".
"Thanks are due to the President for help but also there are a lot of people not in this segment selected to clear their debts, and so are still in difficulty."
When the law to establish the credit-check company was passed by the FNC in March 2009, members noted the need to put it in place quickly.
They emphasised that 560,000 people borrowed almost Dh700 billion in 2007.
Mohammed Zaqout, the head of personal banking at Al Hilal Bank, said the ministry's six-month target was optimistic.
"It is an aggressive target but we really hope that it is met," Mr Zaqout said. "We know it is not easy, that it needs time. Banks need time for data processing.
"We know that it might take longer, but overall progression in this is very good."