Can you get CRB clearance without paying your default loan? All you need to know
Mention Credit Reference Bureau (CRB) to any Kenyan and you will have awakened the sleeping monsters behind their skulls. At the mention of CRB clearance many ordinary Kenyans will be counting the number of loans they have accumulated that are in default status.
Many have sort out for all manner of methods to get their names cleared with Credit Reference Bureau (CRB) while avoiding the pain of repaying their loans that have since been listed. A quick go through on social media pages will introduce you to many individuals who claim they can get your loan cleared from the Credit Reference Bureau and all your loans will be forgotten forever at a small fee.
But the actual question is, can you really get cleared from CRB if you are already a defaulter without clearing your loan?
In this article we look into some insights you need to know about CRB and if indeed it is true that someone out there can perform magic and get your details erased from the Credit Reference Bureau database.
A credit reference bureau (CRB) is a firm that collects information from financial institutions and provides consumer credit information on individual consumers for a variety of uses. CRB’s hold credit data shared by financial institutions and facilitates credit lending to financial institutions.
Credit Reference Bureau (CRB) on a monthly basis collects credit information on all existing and new credit facilities granted to a person(borrower) by the banks, financial institutions and other institutions authorized by the Bank (CBK)including mobile money lending apps.
Upon defaulting, It takes 90 days for banks and 30 days for mobile lenders after which individuals are notified that they are going to be listed if they don’t make any payment on their loan.
At the expiry of this period, the individual will be listed with CRB as a defaulter.
Who can clear you from CRB?
So, the biggest question is, who can clear you from CRB?
It is important to note that there is no single office called Credit Reference Bureau (CRB) you can walk in to get clearance. While the Bureau collects data in collaboration with other technological companies from money lenders for listing and rating individuals, the clearance process is entirely handled by these technological companies.
In Kenya some of the Companies that offer CRB clearance services include; Metropol, TransUnion and Credit Info.
While this companies can handle the CRB clearance process to the latter, they can do nothing if they do not get authorization from the money lender.
For the clearance process to successful, a number of steps have to be taken. First the loan defaulter needs to settle the amount in full, because you had already been listed but you have cleared your loan, you will need to initiate the clearance process by yourself.
While some money lenders may take it upon themselves to update your record with CRB, most of the money lenders leave the burden of CRB clearance on the shoulders of borrowers. Here, you are required to inform your money lender that you need assistance in clearing your name from the CRB database.
Here the money lender should issue you with a batch number for the payment made, this is the most important tool in your CRB clearance process.
The batch numbers contain information of your loan status. This is a payment proof that can be presented to the CRB Clearance companies for clearance process. The companies in this case Metropol, TransUnion and Credit Info will use the information contained in your batch to update on their system and update with the Bureau that indeed you have cleared your loan.
At this stage your account will be updated from a non performing account to an account with default history. It is only then that you will legible to apply for any other loan without restriction or be able to apply for a CRB clearance certificate. However, for the mobile loan that relays on your credit score to issue you with loans. It might take time for your low credit score to rise to determine your credit worthiness.
READ:CRB Clearance Offices and Contacts In Kenya. How to get Clearance
Considering the many parties involved for one to get clearance from the Credit Reference Bureau, it is impossible for any individual to falsely claim they can help you get clearance or CRB clearance for that matter before paying your defaulted loan.
Whoever purports to have the ability to get your details cleared or removed from the Bureau database is a fraudster and should be avoided at all cost.