The regional authorities are currently working to create two new institutions that will serve to provide banks and merchants in CEMAC with more information on their customers. This will allow for an improvement in both the development of local payment systems and the ability of banks to lend with increased confidence.
Payment Incidents Registry
The regional central bank, Banque des Etats de l’Afrique Centrale (BEAC), is currently working to put in place a new registry of payment incidents across the CEMAC region, something which has already been piloted in Cameroon and Chad.
The aim of the system is to identify clients that have committed payment-related infractions – such as submitting bouncing cheques – in the past and subsequently ban them from using such payment systems, in line with regulations issued by the BEAC in 2003. This will allow for greater confidence in such means of payment, increasing their use and in turn reducing the amount of hard currency in circulation in the region. The new registry will be linked to a biometric identity database, further enhancing trust in the system.
The registry will consist of two elements; a central database called CIP Collect, which will host information on payment incidents broken down by country, and a system known as Allo-Incidents, which will distribute this information to banks and other lenders, as well as to merchants and other recipients of payments.
In 2015 Gabonese banks began collecting biometric identifying information from new customers to lay the foundations for the system, and the institution came into being in April 2016. It is working with banks to collate information and create the dossiers that will form the basis of its database ahead of entering into operation which, according to Pierre-Marie Ntoko, secretary-general of the Professional Association of Credit Establishments, is expected to take place very soon.
Christian Gondjout, director of strategy at Banque Internationale pour le Commerce et l’ Industrie du Gabon (BICIG), told OBG that the system will increase the availability of information and change risk management practices, but that it was too early to know what impact it would have on the development of local payment systems.
The BEAC is also working on a separate project to put in place a new CEMACwide credit bureau, which is due to become operational by the middle of 2017. Industry stakeholders believe that the new system, which will replace an existing risk registry run by the BEAC, will have an even greater impact on the sector than the payment incidents registry, for example by helping to boost lending and reduce costs.
“The current registry has a lot of limitations, such as a lack of sufficient information on clients, and banks are largely limited to analysing would-be borrowers’ revenues,” said Ntoko. “The credit bureau will allow them to look at clients’ credit history and other information, and will cover their history not just with banks but also with other institutions such as microcredit providers and large retailers.”
The system will also allow banks to better analyse small and medium-sized enterprises, potentially leading to a boost in credit to such firms, which can be difficult to access. “The challenge lies in harnessing the historical information needed for such a project,” Claude Ayo-Iguendha, director-general at BICIG, told OBG.
The combined effect of the two projects is expected to be profound. “These institutions will have a major impact on the market by significantly improving lenders’ access to information,” said Faissal Chahrour, CEO of Alios Finance Gabon.
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