TanzaniaInvest interviewed CEO of Dun & Bradstreet (D&B); Miguel Llenas and he shares interesting insight on Tanzania’s first credit bureau and why Tanzania is a promising business environment.
TanzaniaInvest.com : The very first credit bureau came to Tanzania last year. Why Tanzania and why now?
Miguel Llenas : My first answer is why not! After extensive review of African countries, I found Tanzania to be the most stable, probably the most pro-active one in financial growth; in financial maturity and for many reasons I was here in 2004 and 2005 as an Adviser.
I personally found that Tanzania could become the most powerful country in Africa, with the exception of South Africa. All the good signs are pointing to Tanzania. {xtypo_quote_right}I personally found that Tanzania could become the most powerful country in Africa, with the exception of South Africa. All the good signs are pointing to Tanzania.{/xtypo_quote_right}Tanzania has everything. So I believe that Tanzania is the place to be.
TI : How is it possible that Tanzania did not have a credit bureau?
ML : Timing and legal issues. Bank of Tanzania has been pursuing this for a long time. We said we want to be the first ones here, we want to invest whatever it is to do business in this market. I think it is the right time to do it.
TI : How necessary is a credit bureau in Tanzania? Tanzania’s banking industry is booming, even without a credit bureau. So how relevant is it?
Ml : It has been booming without the right control and I do not mean the control from the Central Bank, I mean that lending to companies and people without knowing their history with other banks and other financial institutions is booming without a leg.
Tanzania is a four-legged table, we have good regulators, we have strong financial system, we have a powerful private sector and enterprise but in that table one leg was missing. It was the credit bureau that could bind them all together and let them understand to whom they are lending and the risks involved.
TI : We learned through your presentation today; two things are key to a good credit bureau system; the amount of reliable information and the quality of this information. We are talking about a country that has just introduced ID cards, how can you reconcile this with an emerging country and the information technology available here? Can they combine?
ML : Yes, they will combine in time. The fact that the ID is not reliable yet, does not take away the fact that people and companies are getting loans. The ID is immensely positive. When we build a credit report, the key factor is local ID.
So banks here are lending without the right identification, this is going to be solved through the ID system and through the credit bureau. It is a hassle now but in a very short time, I feel that 1-3 years from now those hassles are going to be in place and we will be fine.
TI : What distinguishes Dun & Bradstreet from other credit bureaus?
ML : Dun & Bradstreet is a powerful brand. Dun & Bradstreet means a lot of security for people, a lot of ethics and a company that knows what it is doing. We have combined our vision of the best of all worlds, Africa, Middle East, South Asia. So we have different formulas for different countries and their markets.
We try to understand different stories, the understanding of the markets, understanding the legal frameworks, the people and the heart of the country. That distinguishes D&B from other credit bureaus. So D&B here is a Tanzanian D&B.
TI : Where do you see the greatest challenges and opportunities in Tanzania in the next five years?
ML : The greatest challenges obviously is the support from the banking support and the quality of the data that has come to us. I feel a 100% support from the banks, so it is the quality of the data that is challenging. But really, this bureau has more blessings than challenges.
Legislation, good support from the society, good support from the people, good support from the Central Bank…all are present.
TI : D&B is setup in other parts of Africa and around the world, if you had to compare setting up in Tanzania to other parts of the world, how would Tanzania fare?
ML : The easier one. It is easier because of the people involved, because of the role of the Central Bank, because of the willingness of the banks, that we have this opened as fast as we can. The challenges were minimal to get to this point and everything is running smoothly right now. So Tanzania is a mature market.{xtypo_quote_left}…we have this opened as fast as we can. The challenges were minimal to get to this point and everything is running smoothly right now. So Tanzania is a mature market.{/xtypo_quote_left}
TI : How would you describe Tanzania to people abroad? What is Tanzania about?
ML : I could come and live here without any problem. It is a great country to work with. There is a feeling here that people want to be the best country in Africa and they will get there.
