Loan applications increasingly detailed
The purpose of the new regulation is to be to facilitate the operation of loan companies and other entities. More personal data means a more precise determination of the applicant’s creditworthiness, and hence lower credit risk for the lending company.
An additional plus will be reducing the number of over-indebted people who sometimes hide their bad situation to get another loan, which in the end they have nothing to pay for.
Security of personal data
In view of the exchange of such meticulous personal data, it is striking that institutions authorized to process such data are ready for the upcoming changes.
On the one hand, undeniably, loan companies will be able to more accurately than before determine the borrowing capacity and credit risk of the commitment given. On the other hand, not all institutions in the non-banking sector are large corporations.
There are also start-ups in our market
They are successful, but they do not have international experience and high capital that could invest in systems that simultaneously allow the processing of such a large amount of data while maintaining a high quality of security.
Of course, large institutions operating on our market, presenting the highest level, sometimes exceeding the banks, are ready to process more personal data of customers. For these biggest players in the banking sector, it is a great opportunity to expand the currently offered offer – greater knowledge of the customer will allow them to define their needs more accurately, and thus to prepare products ideally suited to the expectations of customers.
According to Jerzy, president of the Polish Bank Association, the right solution would be to provide detailed information to entities prepared for it, i.e. large companies that will be able to guarantee the security of personal data entrusted to them.
However, the Association of Loan Companies does not agree to such selection and discrimination against smaller entities. Lending companies already acting in accordance with the T Recommendation issued by the Polish Financial Supervision Authority regarding good practices in the field of retail risk management of credit exposures collect from their clients the information needed to assess their creditworthiness and credit risk.
Avoiding excessive debt
The Ministry of Finance maintains the position that everyone, i.e. small, medium and large institutions, will benefit from the regulation as proposed. In-depth customer verification will reduce the scale of recent identity theft.
Even if the thief comes into possession of data from our ID card, he will still have a problem with further completing the application, including providing information about having rights to the premises, or even the names of the parents and mother’s maiden name. Above all, however, our creditworthiness will be determined with greater accuracy, which will avoid excessive debt.
Therefore, the issue of transferring our detailed personal data from one institution to another seems strongly controversial. On the one hand, there are many positive effects of such activities, but on the other hand, it seems obvious that not all entities will ensure 100% security of processed data.