What to know about credit reporting, consumer reports, and other news from India
Posted On August 5, 2021
India has seen a surge in consumer reports since the introduction of the national credit reporting system in December 2014, a move widely seen as a way to fight fraud and keep consumers safe.
But consumers in India are also beginning to be hit by other problems that could pose a threat to the system as well.
A report from the National Credit Rating Agency of India (NCRAI) in November found that the number of credit reports issued in India has jumped from 1.8 million in 2014 to 3.4 million in the same period this year.
“We have witnessed an increase in credit reports in India, in a span of about three months,” said Neeraj Choudhary, the president of the Credit Counselling Association of India, a trade body that represents more than 3,000 credit card companies.
“The biggest problem we see is with the new-model of credit reporting.
We see an increase of new-age credit reports, which is quite alarming.”
The report comes on the heels of another report, released by the National Council of Credit Unions in October, which found that there was a 26 per cent increase in new credit reporting inquiries in India over the past six months.
In the past, India has been lauded for having a high number of banks, credit unions, and companies that offer a wide variety of financial services, such as credit cards, mortgages, and even personal loans.
The country also boasts some of the world’s largest tech firms, including Facebook, Google, and Apple.
But many of the companies’ employees in India work in Bangalore, a hub of India’s technology sector.
In October, a US-based data security firm said that India is among the top three countries in the world for hacking attacks against banks, a position it attributes to India’s lax rules and lax oversight of financial institutions.
“There are a number of factors that are behind the high number,” said Ravi Sengupta, a partner at cybersecurity firm FireEye, who said India is a high-risk country for cyberattacks.
“There are many factors that have contributed to the high levels of attacks that have been observed over the last few years.”
There have also been some reports of identity theft, with many people saying they are unable to identify their bank accounts because they cannot access their phone numbers, or their bank account number.
The NCRAI, however, has said that the increase in reports is not related to the national system, and it believes there is a wider phenomenon.
“It is due to the fact that many people are coming forward to report the same problems that we saw in India,” Choudham said.
“So, we are seeing a number who are reporting that they have been affected in the past but are now seeing the issues they were not able to report.”