Twenty percent of borrowers in Kazakhstan have a damaged credit history. This data was previously reported by the First Credit Bureau (PCB). They calculated that over nine million Kazakhstani citizens have active loans, as reported by a Tengrinews.kz correspondent.
No one is immune to issues with loan repayments and delays, and this information is immediately recorded in your credit history, potentially harming it for an extended period.
Here are some tips from the CEO of the First Credit Bureau (PCB), Ruslan Omarov, on how to "clean up" your credit history.
Photo: depositphotos.com
The first step is to obtain your personal credit report and examine it closely.
"You need to understand what issues exist in your credit history. Problems can vary greatly: delays, fraud (intentional or unintentional), and sometimes even incorrect data transmission about the borrower to the Credit Bureau due to technical issues. This is rare, but it can happen; numbers can get mixed up. Therefore, an individual should regularly check their credit history," says Ruslan Omarov.
Once you identify that there is a problem, you will receive a personal credit rating (PCR). A rating of 700 is considered a good indicator; it is the minimum score for almost any financial institution (banks) to qualify for a loan.
"If a person realizes that their PCR is insufficient, there are several steps they can take to 'align' their credit history. Each borrower's credit history is unique. Some may have many credit cards, while others may have delays, and so on. The credit rating is calculated by a machine, which deems you a potential risk for loan issuance. A borrower might have, hypothetically, 100 consumer loans that could be reduced. They can refinance these loans or consolidate them into one larger loan for easier management," explains Ruslan Omarov.
If a borrower has a significant debt burden in terms of payments, they can also approach the bank to renegotiate the payment schedule.
"Currently, financial institutions are more than willing to assist borrowers in taking steps to 'pull themselves up.' It’s similar to someone being ill who needs to take medication. If they don’t take action, they won’t recover. Doing nothing will only worsen the situation, not improve it," emphasizes the expert.
The "Black List" of Debtors
According to Ruslan Omarov, the First Credit Bureau (PCB) does not maintain any "black" lists of debtors.
"In our country, there may be 'black' and 'gray' lists, but these pertain to fraudsters, dropouts, and those engaged in illegal activities. We only indicate that a person has a problem, that they have a poor credit history. We never label someone as a bad person; we present data from banks showing that they have issues, such as delays on a specific loan," clarified Omarov.
The speaker notes that sometimes, even with a damaged credit history, certain financial institutions might still issue a loan despite existing delays, as they have a sufficiently aggressive credit policy.
Rehabilitation of Debtors
According to the PCB, in recent years, 2.8 million contracts have been rehabilitated in Kazakhstan, affecting around 2 million borrowers. Of those rehabilitated, 1.4 million have managed to secure new loans, while 300,000 have already defaulted on new contracts for more than 3 months.
As Omarov points out, due to measures taken to reduce the debt burden on the population in Kazakhstan, the issuance of online microloans has declined.
"There have been significant changes in online microloans. The volume of the PDL portfolio has decreased by about 40 percent. The number of borrowers and contracts has also fallen. This reflects the efforts of our Financial Regulator to reduce the share of online microloans. Why? Because this type of product has become quite burdensome for our citizens. Online microloans serve as a quick financing option for consumers, but they will no longer be issued in such large volumes as before," believes Omarov.
