TWO decisions on the Credit Information Bureau database of the central bank during the Awami League government, toppled in a mass uprising on August 5, 2024, keep menacing the database management more than five months and a half after the interim government鈥檚 installation on August 8 that year. The Bangladesh Bank imposed restrictions before the 2024 national elections that have denied access of Credit Information Bureau officials to their database, effectively holding them from checking whether politicians and businesspeople taking part in the elections are loan defaulters. The Credit Information Bureau monitors loan irregularities with an aim to reduce the amount of loans in default and to ensure risk-free lending. It also provides the Election Commission with information on the loan default of candidates seeking to take part in elections as the laws bar defaulters from taking part in elections. Officials say that the information technology department of the central bank took control of the database in July 2023 under the pretext of a system upgrade and has since then denied CIB officials their access to the database although they were promised the access back in two months.
In such a situation, CIB officials request raw data of borrowers from the IT department for assessment. But what remains further worrying is that the Bangladesh Bank for the first time allowed bank branches to directly alter the loan default status of borrowers. The central bank on September 13, 2023 authorised both head and branch offices of banks and non-bank financial institutions to upload and amend loan data in the CIB database without prior central bank approval. The decentralisation of the data access down to branch offices compromises the integrity of the database. Earlier, only two authorised officials at head offices of banks could upload and amend credit information and any change in the credit information required the approval of the central bank. With 11,227 branches of banks and 287 branches of non-bank financial institutions, all having the authority to upload and amend credit information in the database, the scope for data manipulation has only widened. CIB officials have also been barred from monitoring data submission by banks which also stops them from verifying whether data have been submitted or what the data contain or the volume. CIB officials are reported not to have been given back the access despite their repeated requests to the IT department. Another menace comes up is that whilst the job remains resource-intensive and time consuming, the data could also be temporarily altered for some illicit tasks and be reverted to the original state to allow offenders to avoid accountability under the pretext of mistakes. Allegations have it that a huge amount of money was taken out of banks during the Awami League regime through fraudulent loans reported as 鈥榬egular鈥� with data manipulation.
Whilst the central bank should, therefore, return the access of Credit Information Bureau officials to their database, it should put in place a mechanism for an independent, transparent and accountable management of the database. The central bank should also review the database operation management bank branches are invested with.