17 Questions
How long is the recommended time period for UCBs to work on improving data quality using the Data Quality Index?
6 months
What is the purpose of a Data Quality Index for UCBs?
To rank their performance against peers
What should UCBs consider when formulating or reviewing policies under the Credit Information Companies (Regulation) Act, 2005?
Best practices detailed in Appendix - C
Which document provides a Uniform Credit Reporting Format for Consumer and Commercial Borrowers?
Appendix - A
What benefit can UCBs derive from adopting a Data Quality Index?
Minimization of data rejections
What is the purpose of the directive DBR.No.CID.BC.59/20.16.056/2014-15 dated January 15, 2015?
To require UCBs to become members of all Credit Information Companies (CICs) and submit data to them.
Which new catalogue value has been added to the 'Credit Facility Status' field in the Consumer Bureau?
Restructured due to COVID-19
What is the new catalogue value added to the 'Major reasons for restructuring' field in the Commercial Bureau?
Restructured due to COVID-19
What is the purpose of the Committee to Recommend Data Format for furnishing of Credit Information to CICs?
To mandate the use of a specific data format for reporting credit information to CICs.
Which type of financial institution is required to comply with the directive DBR.No.CID.BC.59/20.16.056/2014-15?
Urban Cooperative Banks (UCBs)
What is the primary focus of the changes made to the Uniform Credit Reporting Format for Consumer Bureau and Commercial Bureau?
Introducing new data fields and catalogues to capture the impact of COVID-19 on credit facilities.
What is the primary purpose of the Technical Working Group mentioned in the text?
To review and update the data formats for credit reporting as needed.
Which of the following institutions is NOT mentioned as being part of the Technical Working Group?
Credit Information Companies (CICs)
What is the time frame given for Urban Cooperative Banks (UCBs) to rectify and upload rejected data to Credit Information Companies (CICs)?
Within 7 days of receiving the rejection report.
What is the purpose of Credit Information Companies (CICs) sharing their logic and validation processes with Urban Cooperative Banks (UCBs)?
To minimize instances of data rejection.
Which of the following entities is NOT explicitly mentioned in the text as being involved in the credit reporting process?
Insurance Companies
What is the purpose of the parenthetical notations (Consumer) and (Commercial) mentioned in the text?
To indicate the type of credit reporting format being discussed.
Study Notes
Data Quality Index
- A common Data Quality Index would help UCBs identify gaps in their data and improve their performance over time.
- It would also enable UCBs to rank their performance against their peers and determine their relative position.
Best Practices for UCBs
- UCBs should adopt best practices while formulating or reviewing their policy and procedure under CICRA with the approval of their Board of Directors.
- Best practices are detailed in Appendix - C.
Uniform Credit Reporting Format
- UCBs have been advised to comply with the directive dated January 15, 2015, and become members of all CICs.
- They should submit data (including historical data) to CICs.
- The Uniform Credit Reporting Format has been modified vide DoR.FIN.REC.46/20.16.056/2020-21 dated March 12, 2021.
- The modifications include:
- Changing the label of the field 'Written off and Settled status' to 'Credit Facility Status' in the Consumer Bureau.
- Adding a new catalogue value, 'Restructured due to COVID-19', to the field 'Credit Facility Status' in the Consumer Bureau.
- Adding a new catalogue value, 'Restructured due to COVID-19', to the field 'Major reasons for restructuring' in the Commercial Bureau.
Technical Working Group
- A Technical Working Group will be constituted to review and make changes to the data formats.
- The Group will comprise representatives from Scheduled Commercial Banks, Urban Cooperative Banks, Regional Rural Banks, CICs, NBFCs, HFCs, IBA, and MFIN.
- The Group will submit the finalised data formats to RBI for approval.
Rectification of Rejected Data
- CICs should share the logic and validation processes involved in data acceptance with UCBs.
- The reasons for rejection should be parameterised and circulated among UCBs.
- Rejection reports should be made simple and understandable.
- UCBs should rectify the rejected data and upload it to CICs within seven days of receipt of the rejection report.
Test your knowledge on the Uniform Credit Reporting Format with a focus on consumer data. Questions will cover denotations, adoption by UCBs, and the constitution of the Technical Working Group. Get ready to challenge yourself!
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