April 2, 2019
Everytime you’ve applied for a financial product, you may have heard the terms CCRIS or CTOS thrown around, more so when you apply for loans. And if you’ve never quite understood what those terms mean or don’t know the difference between the two, we’ve simplified it for you here and listed why they are so important to Malaysians.
The Central Credit Reference Information (CCRIS) provides credit reports and is managed by the Credit Bureau of Bank Negara Malaysia. CCRIS collects credit-related information on all borrowers of participating financial institutions in Malaysia. These include individuals, businesses (sole proprietors and partnerships), companies, professional bodies, associations, societies and Government entities. Participating financial institutions encompass all licensed commercial banks, Islamic banks, investment banks, development financial institutions and several other financial institutions such as insurance companies, payment instrument issuers, rehabilitation companies, building societies, credit leasing companies and government agencies.
Participating financial institutions are required to report in on a regular basis, the following information:
All of the information and data is then compiled into a credit report which financial institutions like banks will have access to. The data that will be on the credit report will be broken down into a span of 12 months.
The CCRIS credit report will contain the following information of the borrower:
It should also be noted that CCRIS does not only contain the negative credit information of an individual, but it will also show positive information like your credit approvals and positive repayment history. One misconception that most people may have is also that CCRIS will blacklist you if you have bad repayment pattern. However, CCRIS does not provide any opinion or blacklist any individuals, CCRIS provides factual data which will then be used by financial institutions. And credit facilities that have been fully settled are excluded from the credit report.
You can get your own CCRIS credit report from Bank Negara for free, but you will need go to Bank Negara or AKPK one time to get a 6-digit pin code from the CCRIS Kiosk. Then you can proceed to login in to eCCRIS to get your credit report.
CTOS is a private company, and one of Malaysia’s leading Credit Reporting Agency (CRA) under the Credit Reporting Agencies Act 2010. They too provide credit reporting and is also widely used by financial institutions to determine an applicant’s creditworthiness aside from CCRIS. Usually, financial institutions use more than one credit report to determine an applicant’s credit health and CTOS is also known to be widely used in Malaysia.
CTOS produces the MyCTOS Basic Report and MyCTOS Score Report. They obtain their information from various public sources such as:
The types of credit related information which will be included in the credit report from CTOS will include bankruptcy, legal action and even case statuses. It will also detail an individual’s business exposure, business ownerships and directorships, if any.
Similar to CCRIS, CTOS does not provide comments, opinions or blacklist any individuals. Aside from that, you can also obtain your own credit report from CTOS through MyCTOS. First you will need to register to obtain your CTOS User ID, and once your ID has been activated you will be able to access your credit report from MyCTOS anytime over the internet and even through the CTOS app.
Both provide credit reports, however CCRIS is under Bank Negara Malaysia whilst CTOS is privately managed. Another key difference is how the information is compiled. As for CCRIS, the information is derived from financial institutions. While CTOS on the other hand gets credit related information from public sources such as those we discussed earlier. Ultimately, both provide credit reports although the main difference is how the credit information is obtained.
When you apply for a credit card, or even a loan from banks, before they determine to approve or reject your application it will go through a credit approval process to look into your credit history. The bank you applied to will look at your credit reports before they make a decision. If your credit reports are in good shape, banks will usually have no qualms to approve your application. However if they see missed payments on your credit report, it is highly likely that banks will not approve your application.
Banks will also look at an individual’s credit report to calculate and determine their debt service ratio before rejecting or approving the application. This is because banks will be taking on a risk by approving your application, therefore they look into CCRIS and CTOS and use it as one of their tool and determining factor.
Think of it like your browser history, but one which you cannot so easily amend or delete. Both CCRIS and CTOS will show your credit payment ability and all of your financial commitments. If you took a loan with PTPTN, you should also be paying diligently as any defaulted payments for your PTPTN loan will show up on your credit report. This will then affect your chances when you are applying for a loan or a credit card. So it is important for you to check your credit report is updated and is in the positive!
Now that you know more about both CCRIS and CTOS, it’s time for you to pay closer attention to your credit report so you don’t sabotage your future applications with financial institutions!