The Cabinet approved a Draft Credit Information Business Operation Act (No. ..) B.E. …. (the “Draft Act”) as proposed by the Ministry of Finance (the “MOF”) on 22 December 2020 in order to revise the Credit Information Business Operation Act B.E. 2524.
Summary of the Draft Act are as follows:
- The main purpose of this Draft Act is to allow entrepreneurs who operate as intermediate entity in providing credit facility in forms of new transactions or financial innovations (Final Technology) which are rapidly expanding in Thailand (the “Entrepreneurs”) to be members of a credit information company in which such Entrepreneurs are able to send credit information of their SMEs and start-up businesses to the credit information company enabling the said Entrepreneurs to have their financial history information in its system. This will allow such Entrepreneurs having more opportunities to access to legal sources of fund, gain financial support or loans from other registered financial institutions in the future. This will also, in the meantime, reduce numbers of illegal loan debt.
- The Draft Act will revise procedures for disclosing information of credit information or credit score (“Information”). In regard to the said revised procedures, the credit information company will need to notify in writing to its customers (owners of the Information) within 30 days from the date of disclosing or providing such Information, except for collective Information of financial institutions or Entrepreneurs that the credit information company has admitted as its members.
- The credit information company, information controllers, information processors, members, customers, persons who know Information from working or performing a duty at the credit information company or persons who know Information from the above-mentioned entities/persons shall be basically prohibited to disclose the Information.
- A service user shall not disclosure or disseminate the Information to the others who do not have the right to be informed and that it shall use the Information for specified purposes only, such as using the Information for the purposes of credit analysis and credit card issuance.
- Entrepreneurs will be able to disclose or provide Information to its members for the purpose of credit analysis on behalf of the credit facility provider only.
- Entrepreneurs will be able to use its customers’ Information obtained from the credit information company in order to create a credit model. If such Entrepreneurs use the Information other than for the purpose of credit analysis on behalf of the credit facility provider and other than for the purpose of risk management for the credit facility provider, such Entrepreneurs will be penalized by the provision under this Draft Act.
- Entrepreneurs will be required to explain the reasons for refusal of the services or for increasing of service charges, including sources of customers’ Information to such customers in writing.
- Financial institutions, members or service users, who do not explain the reasons for refusal of the services or for increasing of service charges, including sources of customers’ Information to such customers in writing, will be penalized by the provision under this Draft Act.
This Draft Act will be submitted to the Parliament for its consideration and approval before publishing in the Royal Gazette and then become enforced.