On June 29, 2017, the Kyrgyz Republic’s Credit Information Bureau “Ishenim” and Iceland-based CreditInfo Solutions commemorated the beginning of a strategic and technical partnership in a landmark shareholder agreement signing ceremony. This fundamental occasion marked an important milestone in the World Bank Group’s Azerbaijan and Central Asia Financial Infrastructure development (ACAFI) project which has been supporting the implementation of a complex credit reporting system reform in Kyrgyzstan on several fronts—reforming the legislative and regulatory environment, transforming the credit bureau into a commercial entity and attracting a world-class credit bureau operator.

It is widely accepted that credit reporting systems form the backbone of credit infrastructure and enable the efficient flow of reliable credit related information. In particular, many studies point to a compelling link between sound credit reporting systems and increased access to credit to individuals and MSMEs, as well as an increasing role of an active credit information exchange in a country’s financial stability. In view of this, the ACAFI project team has been using international standards to help the Kyrgyz government and other stakeholders in reforming its credit reporting infrastructure. Thus, in 2014 the WBG team, together with the credit bureau “Ishenim,” transformed the private credit bureau from a non-commercial to a commercial entity, introducing an efficient corporate governance mechanism, transparency and generating commercial incentives for growth. Also, given that modern legislation and regulations are increasingly mandating creditors to share data with credit bureaus, the Project team focused a bulk of its efforts to promote a transparent and competitive legislation on credit reporting that conform to global best practices. In 2016, through its structured and multifaceted interventions, the team spearheaded the enactment of the country’s groundbreaking Law on Credit Information Sharing that governs how credit bureaus ought to function and aims to bolster the institutional capacity of the existing credit bureau.

More recently, credit bureau “Ishenim” obtained its first license from the Central Bank of the Kyrgyz Republic, establishing itself as the first private credit bureau in the country. The signing of a strategic partnership agreement with Creditinfo Solutions presents an opportunity to significantly boost the quality and reliability of “Ishenim”s database, enable lenders to better assess risk and promote responsible lending. Presently, credit bureau “Ishenim” has over 148 financial institutions who supply it with consumer data. One of the major goals of this cooperation is to diversify and expand the sources of information to include alternative data providers, such as utility firms, telecommunications companies, the social fund, the tax agency and others, which in turn will enhance the overall coverage of the credit reporting system and mend information deficiencies. The new business model, coupled with the transfer of modern technological solutions, will help the credit bureau produce comprehensive and reliable credit histories that would depict the borrower’s true level of indebtedness, help assess his/her creditworthiness, improve the quality of loan portfolios and facilitate the creation of new value-added products.