Govt mulls FDI in credit information companies

NEW DELHI: The government proposes to allow Foreign Direct Investment in credit information companies along with commodity exchanges as part of the review policy.
   
"The proposal for FDI in credit information companies (CICs) is under consideration and will be taken to the Cabinet Committee on Economic Affairs after receipt of comments from different ministries," an official in the Department of Industrial Policy and Promotion (DIPP) said.
   
Along with a decision on FDI in CICs, the government is in the process of reviewing FDI policy for a host of other sectors including aviation services, sports goods and real estate. However, official sources made it clear that retail would be kept out of the policy review.
   
Global CIC firms see a huge business opportunity in building up credit history of clients and sharing it with the fast growing financial services sector. Finance Minister P Chidambaram said in New York yesterday that the government intended to make financial services the next growth engine for the country.
   
The Credit Information Act was passed in 2005, defining the legal framework, within which credit information firms can collect, process and share information on clients of banks and financial services firms.

Apart from CICs, the government is also looking at streamlining procedures for FDI in commodity exchanges.