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Increased loan availability and competition between lenders have created the need for credit information exchange. The supervisory institutions, the World Bank, the IMF, the Ministry of Economy and Lenders see it as necessary to establish a Credit Information System (CIS) to help manage credit risk. Credit Information System CIS, collects data from various sources and provides credit information to consumers for diversified uses such as to predict their future behavior, also CIS reduces the effect of asymmetric information between borrowers and lenders, facilitating problems Of unfavorable selection and moral hazard, also reduces the monopoly effect of banks' loans by providing incentives for borrowers to repay their loans on time. CIS collects personal information about individuals, their financial records, and alternative data for individuals from a variety of sources called data providers that are usually creditors, lenders, utilities, debt collection agencies, and courts (i.e. Public records etc.).
About the author
Artur Z. Ribaj Prof. DRFinancial Adviser & Founder SEDALBANIA (Advising Center for Financial Services)expert for financial market and banking, With a experience in finance sector as banker in many banks in Albania and in Bank of Albania. With a expertise in financial market , risk management,governance etc. Professor more than 20 years.
