x Abu Dhabi, UAESaturday 22 July 2017

A brief history of credit check activities in the UAE

From Emcredit to Al Etihad Credit Bureau: a timeline charting the history of credit check operations in the UAE.

A credit check is now mandatory for any borrower seeking to raise funds in the UAE. Mona Al Marzooqi / The National
A credit check is now mandatory for any borrower seeking to raise funds in the UAE. Mona Al Marzooqi / The National

From Emcredit to Al Etihad Credit Bureau: a timeline charting the history of credit check operations in the UAE.

2006

The Emirates Credit Information Company, dubbed Emcredit, is launched in January after a directive by Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai. The first private credit information company in the UAE is incorporated in the Dubai International Financial Centre, requiring it to be compliant with international standards of data protection and security.

2008

Through agreements with seven government data sources, the company establishes a database of 5.6 million consumer identification records, as well as payment behaviour information on consumer and commercial borrowers. It also holds 35 per cent of mortgage data in the UAE.

2009

The Cabinet in March approves the Credit Information Law, which allows the establishment of a Federal credit information company. Once approved by the Supreme Council, the new law will make a credit check mandatory for any borrower seeking to raise funds in the UAE.

2010

In July a law is passed by the Dubai Government, requiring local and international lenders operating in the emirate as well as organisations outside the financial sector such as utilities and telecoms companies, to share client information within the UAE with Emcredit. The same year, plans to create a Federal bureau are also accelerated after gaining approval by Sheikh Khalifa, President of the UAE. Officials from the Finance Ministry and Central Bank prepare bylaws for the bureau, which is expected to begin operating within six months.

2012

The Ministry of Finance establishes Al Etihad Credit Bureau in 2012 as a stand-alone entity with a paid-up capital of Dh200 million.

2013

In October, Marwan Lutfi, a former senior official at Dubai International Financial Centre, is appointed the chief executive of Al Etihad Credit Bureau as it begins hiring staff and compiling a database of credit information.

2014

Plans for the bureau to be ready to begin operations by the end of the first quarter are delayed after banks fail to give the organisation the required information on customers’ credit history. After the official publication of the bureau’s bylaws it is hoped it will start work in June by providing banks with information on consumer customers. By 2015, its service will be widened to include companies.

tarnold@thenational.ae