FINANCE

Personal incomes under bank spotlight

AS OF THIS fall, banks will be better able to check up on loan applicants to see whether they have lied about their income, following a deal giving them access to the data of the Sociálna Poisťovňa social insurance house.

AS OF THIS fall, banks will be better able to check up on loan applicants to see whether they have lied about their income, following a deal giving them access to the data of the Sociálna Poisťovňa social insurance house.

The agreement is another move towards providing banks with more detailed information about debtors. The establishment of the Credit Register two years ago was the first step, enabling banks to check up on the credit history of loan applicants and find out whether they had any additional liabilities. The register also allowed banks to discover whether assets listed as collateral had also been pledged on another loan.

According to the banks, the Credit Register benefits responsible debtors. "In the process of approving loans we take into consideration both the positive as well as the negative information we obtain from the register. Clients with a positive loan history can obtain better credit conditions than someone who has never paid off a loan," Michal Kopecký from the VÚB bank told the Pravda daily.

In practice, however, bank clients tend to feel the negative effects of the register, Pravda wrote. Missing even one payment can complicate access to another loan, as the register automatically records such clients as credit risks. Even if the payment is covered later, the record remains in the register.

"We approach clients with negative records in the register more carefully. If we consider it serious we can refuse their application for a loan," said the Slovenská Sporiteľňa bank in a statement.

The Credit Register was launched in October 2004. It contains data from the majority of banks in Slovakia, including construction savings houses. Given the success of the Credit Register, some smaller credit and leasing companies are also preparing a list of debtors.


- From press reports

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