The Barbados Parliament recently passed the Fair Credit Reporting Act, which allows for the creation of a regulatory environment to promote the development of a fair credit reporting system.

Arising from the passage of the new act, Barbadians will for the first time be able to get local credit scores. The new act sets out the regulatory framework for the use of such data and the secure keeping of the private data of persons collected by credit bureaux.

The Central Bank of Barbados will be the regulator. Finance Minister Ryan Straughn was quick to point out that financial information will be kept confidential.

He noted that while credit information providers—including commercial banks and other financial institutions, hire purchase offerors, utility companies, Government departments and other entities—will share information on debt obligations to determine individuals’ creditworthiness, that personal data will be kept secure.

Penalty for breaches

Under the legislation, a credit bureau that discloses information without consent is liable, on summary conviction, to a fine of $50,000. Additionally, any person who obtains credit information from a credit bureau by deception could face a similar fine or be imprisoned for three years, or both.

That penalty also applies to a credit bureau or user that discloses information about credit given to an individual or business or retains that information for a period longer than seven years after the date the credit was settled.

The minister argued that the legislation will facilitate cross-border credit reporting so information can be used outside of Barbados. The Government will be rolling out a public campaign next year to educate individuals and small businesses on the system insisting that Barbadians will not be passive participants.