Limited access to reliable credit information continues to prevent small businesses and individuals in Namibia from accessing financing, with industry players calling for the use of alternative financial data to improve lending decisions and expand financial inclusion.
Creditinfo Bureau Namibia Executive Director Karen Jansen van Vuuren said many potential borrowers remained excluded from the formal credit system because financial institutions lacked sufficient information to assess their creditworthiness.
Speaking at the Third Africa Credit and Risk Reporting Conference in Windhoek, Jansen van Vuuren said traditional credit assessment systems often failed to capture the financial activities of individuals and businesses without established borrowing histories.
She said mobile money transactions, utility payments and supplier records could provide lenders with additional information to assess borrowers who would otherwise struggle to qualify for credit.
The use of alternative data could particularly benefit small businesses and individuals operating outside conventional banking systems by allowing lenders to evaluate their financial behaviour beyond traditional loan repayment records.
However, Jansen van Vuuren said improved access to credit information needed to be accompanied by stronger data quality standards, consumer protection and fair pricing to ensure that borrowers benefited from financial innovation.
“As a credit bureau, we believe our role is to help change that, working together with regulators, lenders and fellow credit bureaus. This means improving business information, incorporating more positive data, strengthening cooperation on data quality and supporting responsible innovation that protects consumers,” she said.
She said cooperation between regulators, lenders and credit bureaus would be essential to developing credit reporting systems capable of supporting more inclusive lending practices.
Kenyan High Commissioner to Namibia Florence Bore said Namibia and Kenya had opportunities to strengthen cooperation in mobile money, digital credit and credit information sharing by exchanging expertise and developing institutional partnerships.
Bore said the growing use of digital financial services presented opportunities to expand access to financing but also raised concerns over data privacy, cybersecurity and consumer protection.
She cautioned that financial innovation without adequate safeguards could deepen financial exclusion rather than address it.
“Our countries can learn from one another through the exchange of expertise, institutional partnerships and practical collaboration. Neither country needs to have all the answers. Our collective strength lies in sharing experiences and adapting effective solutions to our respective national circumstances,” Bore said.
She added that closer cooperation in financial services could strengthen trade and investment relations between Namibia and Kenya while creating opportunities for businesses and investors.
Credit Information Sharing Association of Kenya Chief Executive Officer Andrew Njeru said African financial systems needed to move beyond increasing access to banking and credit services towards ensuring that financing supported productive economic activity.
He said effective credit information sharing could improve lenders’ ability to assess risks and make informed decisions, particularly when dealing with borrowers whose financial activities were not reflected in conventional credit records.
“The opportunity is expanding as financial activity generates new sources of data. With appropriate consent and safeguards, transaction records, digital payments, sales data and other relevant information may help lenders understand borrowers whose economic activities are not fully reflected in traditional credit records,” Njeru said.
He said artificial intelligence and alternative data could further strengthen credit assessments, provided appropriate safeguards were implemented to protect consumers.
The conference, held under the theme Advancing Africa’s Credit and Risk Reporting for Open Finance, brought together regulators, financial institutions, credit bureaus and technology providers to discuss improving credit reporting systems and expanding financial inclusion across Africa.
