Credit reporting firm TransUnion expands service to SMEs

Seven years after its inception as the country’s first comprehensive private credit bureau, TransUnion Information Solutions Inc. plans to be a pioneer in assessing the creditworthiness of small and medium enterprises (SMEs).

By expanding its coverage to include SMEs, deemed as the backbone of the Philippine economy, TransUnion seeks to use big data to allow more SMEs to tap financing and for financing institutions to enlarge their borrower base in support of the financial inclusion agenda.

“Information is a powerful thing and we realize that at TransUnion, the information we provide can empower our customers to make better and smarter decisions,” TransUnion president and chief executive Pia Arellano said in a briefing yesterday.

As a credit bureau, TransUnion helps consolidate the credit information system and the collection and sharing of both positive and negative data. It is part of Chicago-based TransUnion, one of the world’s leading business intelligence providers, maintaining one of the largest collections of consumer information in more than 30 countries in the last 40 years.

Set up by five of the country’s largest credit card issuers in 2011—BPI, BDO, Metrobank, Citibank and HSBC—the Philippine unit of TransUnion now has about 38 reporting financial institutions, including most of the major commercial banks. It is also accredited as a special assessing entity of Credit Information Corp.

Using historical data, TransUnion creates stories and shares different insights and trends, giving institutions greater confidence to extend credit while prompting more people to become financially responsible.

“In the end, we’d like to think that we’re a catalyst for driving economic growth in the country and that really is the essence of our mantra: information for good,” Arellano said.

TransUnion is now developing a credit scoring system for SMEs. Given that for SMEs, it’s really the main proprietor who would be assessed, expanding to this segment is seen as a natural progression for TransUnion.

Based on how TransUnion has grown in other markets, the business usually started with grading consumers but eventually expanded coverage to SMEs.