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Fiji lacks privacy law

Consumer Council Of Fiji
Saturday, November 17, 2012

THIS week, we take a look at stakeholders' reaction on Data Bureau Limited (DBL) operations.

As highlighted before, DBL is a registered company that was initiated by a group of financial institutions and insurance companies in Fiji in 2000 and is involved in sharing private information on its members' clients with each other and with other entities in Fiji.

Key stakeholders have defended the establishment and operations of DBL in the "The Hire Purchase Industry in Fiji" report launched by the council in July.

Data Bureau member Morris Hedstrom (MH) defends the Data Bureau practices:

"The Data Bureau is a key agency for hire-purchase financing as it acts as a credit assessment tool. It is a mechanism that allows credit providers to determine customer rating and this is the usual practice overseas where similar agencies offer this service. Our demand notices carry a disclaimer that customer details would be loaded on Data Bureau if customer defaults repayments."

The Reserve Bank of Fiji (RBF) also defends the operations of the DBL, saying that it "plays an important role in the area of credit risk management and the promotion of a sound credit culture in the financial system of the country. The existence of DBL makes it easier for financial institutions to make informed and responsible lending decisions in a timely manner. Checking with the Data Bureau would also help the financial institutions to mitigate any possibility of serious problems such as fraud cases or the risk of defaulting".

The RBF, however, accepts the issue of consumer confidentiality. It states:

"The Reserve Bank of Fiji is of the view that to protect the confidentiality of consumer information the Data Bureau should only provide personal credit information to a financial institution for the purpose of assisting the financial institution to evaluate a credit facility application or for a periodical credit review if the person is an existing borrower.

"The financial institutions should not be allowed to access credit information for purposes other than evaluating credit facility application or credit review.

"For example, financial institutions should not use the credit report to market their financial products or services."

While there is contractual conditionality on making credit information of HP consumers available to others, which can be interpreted as an individual waiving one's right to privacy of credit information through signing a credit contract, the issue of right to privacy remains.

In Fiji, there is no law that guarantees consumers a right to privacy.

The fact that operation of DBL is within the law, however, does not end the issue of right to privacy.

A majority of the consumers did not know that their records could be listed on the Data Bureau Limited database or provided to others, or that the HP company could seek information on them from other businesses or sources.

But over a third knew this and still entered into the contract of the purchase because they had no choice.

According to the HP report, legal challenges on the basis of the existing situation may not be a viable option.

It states that consumer advocacy which results in a vast majority of consumers refraining from entering into HP agreements which impact the privacy of their credit information would be more desirable.

It further states that the state may, however, consider enacting legislation on protection of privacy which may address the issue of privacy of personal credit records.

The HP report recommends that a better alternative, however, is to encourage financial institutions that enable consumers to save money and purchase goods on a cash basis.

There are a number of informal 'clubs' in Fiji, through which members save and deposit small sums of money, to later withdraw to fulfil the purpose of their savings. This concept has a good foundation for growth in Fiji.

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