World Bank ranks highly the Credit Registry of the CBCG
05/11/2019
The latest Doing Business 2020 report, the World Bank’s survey investigating the quality assessment of business environment in 190 countries, ranked Montenegro the 15th concerning the ‘getting credit’ sub-category that includes the Credit Registry of the Central Bank of Montenegro (CBCG), which was far advanced compared to countries in the region. The Doing Business 2020 report also reported that Montenegro, along with New Zealand, was singled as country leading in the world concerning the highest quality of legislation on client protection (of loan beneficiaries and providers). This index measures the degree to which the legislation on banks’ collaterals, and bankruptcy and liquidation protects the rights of loan beneficiaries and providers, thus facilitating the lending.
Moreover, Montenegro had better coverage of credit registry (41% of population compared to 24.4%) compared to advanced OECD countries, since its registry covers all loan beneficiaries in Montenegro.
Such an important result of Montenegro in the Doing Business 2020 was the result of constant improving of the Credit Registry of the CBCG, a unique and standardised electronic database on loans and other borrowings of persons in Montenegro. It is based on data and information that reporting entities (banks, microcredit financial institutions, the Investment and Development Fund of Montenegro, leasing and factoring companies, banks in bankruptcy, and special reporting entities) are obliged to submit to the CBCG.
The Credit Registry was established in 2006, and since then it has been developing and improving continually, thereby considerably improving the quality and coverage of monitoring the systemic risks in the financial sector. During the last two years, the significant activities of the CBCG improved the Credit Registry’ functioning and improved the quality of its services. In addition to detailed monthly report on client’s indebtedness in the system, the Credit Registry collects and exchanges data on new placements and executed payments on daily basis, thus achieving the daily updating of data on all placements in the system. For that purpose, a set of new reporting forms for the system was created, as well as the report on credit history of each individual borrower.
The Credit Registry includes all loan beneficiaries in Montenegro. As at end-2018, it had registered 144,783 persons with borrowings from loans, leasing, credit cards, overdraft, letters of credits and other reported borrowings.
The Credit Registry will continue to improve in the future and to increase the spectre and quality of information exchanged, particularly through providing additional information on financial reports of companies being loan beneficiaries in Montenegro and information on companies with frozen accounts as at reporting date to be searched.