Trans Union Central America

completed

The project''s prime objective is to foster the development of Central America''s nascent credit information system, thus facilitating the extension of credit to previously underserved client segments. Empirical evidence has shown that credit bureaus are critical to the expansion of credit, that the availability and use of credit bureau reports in credit decisions increase the quality of the credit decisions, and that credit bureaus provide a significant protection for financial institutions against fraud.IFC has been working closely with the World Bank over the past two years to build capacity and promote better credit information infrastructure in our member countries. The first phase of our efforts focused primarily on promotional undertakings, including an international conference on credit information and credit scoring in 2001, roundtables and video-conferences hosted in or for a number of countries including Central America. The proposed investment in TUCA would be IFC’s first investment in a consumer and commercial credit bureau.The investment would support and finance TUCA’s expansion in Central America through the establishment of new subsidiaries, as well as outsourcing arrangements for and investments in existing credit bureaus. TUCA, through its subsidiaries and affiliates, will be providing both consumer and commercial credit information primarily to financial institutions. The project is expected to significantly improve the current credit information infrastructure in the region, and allow financial institutions to make better credit decisions and pro-actively manage and monitor their existing portfolios while at the same time lower operating expenses. This in turn will lead to greater access to financing for the underserved as improved credit information allows lenders to extend more credit while maintaining or reducing their loan losses.