Thursday, August 18, 2016


    Yes, Virginia, a cooperative (or any "Submitting Entity", for that matter) may not comply with the requirement of submitting its members' credit data to the Credit Information Corporation (CIC) and still NOT be penalized of up to P30,000.00 per day.

    Sounds impossible, or too good to be true?  Have you heard of the adage: "For every rule, there is an exception?" We are pointing this out, not to encourage non-compliance, but as a recourse for those cooperatives (or other Submitting Entities) deserving of non- coverage by the CIC rule, if only temporarily.

    This recourse you may find in CIC Letter Circular No. 2016-02, series of 2016, which CIC uploaded in its Facebook page last August 16, 2016.  The Circular contains Frequently-Asked Questions (FAQs) and answers to clarify specific issues.

    From Q5/A5, and I quote: "..Therefore, unless otherwise advised by the Submitting Entities' regulatory body on a per institution basis, or from direct petition from Submitting Entity itself, all Submitting Entities will be assumed to be capable of compliance.."(emphasis provided).. 

    To me, this means that if you were not able to take any of two actions mentioned above, and you simply ignored the CIC deadline, then you are assumed as capable of compliance, but did not comply.  Hence, you are liable to the penalty upon determination of CIC, of not exceeding Php30,000.

    What is the implication of these clarifications?  To me, it means (please, correct me if I interpret this wrongly, which I don't think so), that if the Cooperative Development Authority (CDA), for example, certifies that a certain cooperative is not (yet) capable of compliance, CIC will take cognizance of the cooperative regulator's advice.  And CIC will exempt said cooperative, in the mean time.

    To my mind, this similarly applies to other institutions:  for a Mutual Benefit Association (MBA), the regulator would be the Insurance Commission; for Microfinance NGOs, it would be the S.E.C., and so on.

     So, what will it be for you? Petition CIC to defer your individual coverage; or ask your regulator to certify that you are not yet capable of compliance.  So, there.

    Cooperatives, take note of the Oct. 30, 2016; and December 31, 2016 compliance deadlines.  Published news reports alleged that CIC had moved compliance to June 2017.  But in the absence of a formal CIC Circular on the supposed new deadline, I will not bet on it.

    By the way, the CIC Letter Circular 2016-02 was bylined/signed off by no less than Mr. Jaime Garchitorena, president & CEO of CIC.


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