Sunday, October 30, 2016


Credit data system pushed

State-run Credit Information Corp. affirmed its position that the Credit Information Systems Act is

constitutional amid calls from several sectors to suspend the law.

CIC chief executive officer and president Jaime Garchitorena told reporters only the Supreme Court

could determine the constitutionality of the law.

Passed into law in 2008, Republic Act No. 9510 or CISA directed all lending institutions to submit

their clients’ basic and credit data to CIC.

The law calls on lending agencies like banks to submit the credit track record of their borrowers to

 CIC. The requirement will enable a lending agency to gain access to the record of a borrower and

help it in deciding on a loan application.

“One is that some people claim that the law itself is unconstitutional, so our answer to that is that no

 one can determine the constitutionality of a law, except the Supreme Court. So unless it’s brought

forth to the supreme court, the law stands,” Garchitorena said.

“The CISA bill was passed unanimously, zero opposition in both the Congress and the Senate. So

when we talk about constitutionality, you’d have to imagine that first of all, the premise for this CISA

act did not exist,” he added.

Garchitorena also defended CIC on the issue of privacy against the data collection activity of the


“Fortunately for us, the data privacy act is very explicit when it says that the data collection activities

by the CIC, using the  RA 9510 as a basis for collecting data, is exempted from the data privacy act,”

 he said.

Several groups of cooperatives from Mountain Province province and the Visayas areas sought a

postponement of the implementation of the law on alleged violation of the Philippine Cooperative


The law states that a cooperative is an autonomous and duly registered association of persons, with a

common bond of interest, and independently controlled by its members.

Article 140 of the Code prohibits “direct or indirect interference or intervention by any public official

or employee into the internal affairs of a cooperative of which he is not a member.”

“… the word autonomy may have been used in their law, but I cannot imagine a law that creates an

 institution that is autonomous from the law. … even if you are given autonomy to do business,

autonomy does not mean being autonomous from the law,” Garchitorena said.

CIC recently extended the deadline for data submission among large and medium cooperatives until

the end of the first semester of 2017 in response to the call of cooperatives and their federations.

Cooperatives have faced challenges in meeting CIC’s deadline. These include the inability of many

cooperative members to provide a tax identification number, their lack of access to the internet and

technical capacity, and the outdated nature of their systems.

“The cooperatives are a critical participant in the national financial ecosystem and front-liners in the

goal of enabling greater access to credit for MSMEs,” Garchitorena said.

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