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Bank of Ghana (BoG) has tasked all non-bank financial institutions (NBFIs) to submit data and other information on their borrowing parties to the credit reference bureaus in the country to allow for easy tracking and assessment of the credit-worthiness of borrowers. The BoG also charged them to comply with the directive of making appropriate references before offering credit to their customers. The Assistant Director of the Banking Supervision Department of the BoG, Mr Boyd Donkor, made the call in Accra on Thursday at the launch of a new financial product dubbed �Loan Master� by TF Financial Services Limited, a subsidiary of the Teachers Fund. The launch coincided with the opening of new office of the company at Asylum Down in Accra. Mr Donkor said there were three credit referencing bureaus that had been duly licensed in the country with the mandate to �ease credit referencing and also reduce information asymmetry, which has characterised the financial system�. A credit bureau or credit reference agency is a company that collects information from various sources and provides consumer credit information on individual consumers for a variety of uses. It is an organisation providing information on individuals' borrowing and bill-paying habits. Credit information such as a person�s previous loan performance is a powerful tool to predict his future behaviour. Such credit information institutions reduce the effect of asymmetric information between borrowers and lenders, and alleviate problems of adverse selection and moral hazard. The need for a credit reference bureau in the country arose from, among others things, the high loan default rate in the country which is crippling most banks and other financial institutions. It had been observed that some individuals were using the same collateral or documents to apply for loans in different banks and refusing to honour their obligation, leaving high non-performing loans (NPLs), resulting in the collapse of some banks collapse. Mr Donkor also said the loan book of any financial institution was a key investment portfolio and its quality was the hallmark of its survival, adding �that the maintenance of a good loan book was very critical�. He said it was important for applications for credit to be well screened to meet the required policies and to ensure that credit was granted to the right individuals and at the right time to enable them pursue their various intentions. Mr Donkor also noted that credit granted must be adequate to meet the purpose for which it was requested. �Where credit evaluation is solely based on the assessment of the individual�s ability to pay, but does not adequately consider the use for which it is being sought, it may result in the amount granted being insufficient�, he advised. Mr Donkor added that the granting of credit should also not be seen to have come to an end when funds were disbursed to the applicant. Instead, he said �effective monitoring and control is necessary to ensure that early warning signals are identified and rectified before things get out of control�. �One familiar challenge of the financial system is that of the high non-performing loans ratio which is also normally driven by poor risk management practices�, he said. He expressed the hope that the introduction of an innovative product such as the �Loan Master� would help to address some of the challenges in the credit delivery functions of the NBFIs in the country. The Managing Director of TF Financial Services Limited, Mr Aaron Badza, for his part, described the new product of the company as one that had been carefully thought through to ensure the satisfaction of those who accessed it. He said the company had been able to survive to become one of the formidable NBFIs in the country and gave the assurance that it will continue to ensure good governance and strengthen its risk control systems to prevent high NPLs. The President of the Ghana National Association of Teachers (GNAT), Mrs Irene Adanusa, for her part, urged the workers of the company to devise new customer strategies that would put them ahead of the competition and ensure that their customers make TF their preferred choice.