Etihad Credit Bureau announced a new evaluation method on Thursday that could see UAE citizens who have cleared payment defaults see increases in their credit ratings in six months, based on their subsequent payments behaviour and overall credit history. The new approach, called Credit Score 3i, aims to provide a more holistic view of people’s financial behaviour, while extending credit scoring to those who qualify with short credit histories, including immigrants to the UAE.
The agency said if defaults are addressed, an individual’s credit score may increase within six months, providing they continue to make consistent repayments and match the model’s criteria. But an increase is not guarantyd in this period. The wider coverage is designed to provide a fuller understanding of people’s financial histories, including those who may not have a long borrowing history.
The new model gives banks and other licensed financial institutions more information to help them analyse credit risk and make lending choices. However, the bureau highlighted that individual financial institutions’ lending decisions remain subject to their own regulations and evaluation standards.
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