The Central Bank of Iran will announce a new mechanism for assessing bank customers' credibility in the next Iranian year (starts March 21), the CBI deputy head for innovative technologies said.
"Credit rating is a key prerequisite for offering credit to bank customers. Creating a strong and effective model for credit rating began a decade ago. We have managed to provide credit companies access to a comprehensive database of the people's financial records," Mehran Mahramian was quoted as saying by the CBI website Monday.
He was speaking in Tehran at the opening of the ninth Annual Conference on Electronic Banking and Payment Systems.
Data [about people's financial conduct] was the main challenge before establishing a robust credit rating system, he said. "The government required the CBI to address the problem in 2017 when efforts for creating a workable model for ratings gained pace and we are about to unveil it."
Mahramian said credit rating will be on top of the CBI's innovative plans come April as it would help ease people's access to loans and credit.
The CBI said earlier that easing access to bank loans is in line with government policy to improve financial inclusion and enable people from all walks of life to benefit from bank resources, namely loans.
Last year, the CBI published rules for setting up credit rating firms that scrutinize the financial records of clients and report on the credibility of individuals and corporates by assigning scores on a scale of "very poor", "poor", "average", "good" or "very good".
Ratings are determined after assessing the financial performance of the customer within a fixed period plus solvency, ability and willingness to pay. Scores also indicate credibility and discipline in meeting debt obligations.
Unreasonable demand from banks before giving loans, especially high collateral, is a key complaint of the vast majority of the people against banks, both private and state-owned.
The CBI earlier said that it supports the growth of BNPL services because of its positive impact on the economy.
About 4.5 million people in Iran have used innovative lending solutions, including BNPLs. Snapp Pay, DigiPay, WePod and AzKiPay are the major providers of BNPL services.
The annual report of Digikala, Iran's largest electronic retail platform, shows 5.5% of the purchases were made using BNBL in the last calendar year.
‘Snapp!’, a major Iranian tech firm, said in its last annual report that it made the BNPL service available to 4 million of its users.
The World Banks' Global Findex 2021 shows that 61% of Iranians had borrowed money and 25% had borrowed from formal financial institutions. The largest portion of borrowers had borrowed from friends and family -- 40% of the total population aged above 15.
It showed some 84% of Iranians had made digital payments and nearly 7% had a credit card in 2021, 2 percentage points less than in 2017. An estimated 83% owned debit cards.
