I received this letter (via email) from one of my readers who asked a very timely question. His letter reads, “Mr. Limtingco, I really appreciate your weekly articles especially those pertaining to credit and collection topics. I am a Credit & Collection Supervisor of a lending company, and what I would like to know is that, if there is any Code of Ethics in our profession? I am now doing our credit and collection manual and I would like to incorporate this…”
Well, thank you for asking this question. Personally, I believe that a lot of credit investigators and/or credit analysts may not know this but there is what we call “Code of Credit Ethics”. As in any other organizations this Code of Credit Ethics should be our guiding principle and must be incorporated in our Manual of Credit Operations.
What makes this code unique is that it is universal in nature. It is not bound by regionality, by culture or by ones affiliation, but of the universal principle that must be followed by all credit men around the world. Unfortunately most of our credit men do not practice this Code of Credit Ethics, either they do not know this, deliberately ignored to know this and/ or do not care at all.
The following are the universally accepted Code of Credit Ethics:
First, sacredness of the information. All credit men must respect the confidential nature of the information received.
Second, the identity of the inquirer in whose behalf the inquiry is made should not be disclosed without permission.
Third, the source of confidential information should not be disclosed without permission.
Fourth, letter of inquiry should indicate in some definite and conspicuous manner the object and scope of inquiry.
Fifth, on the other hand in answering inquiries, disclose with all objectivity materials facts bearing on the credit standing of the subject, history of paying habit, including basis of credit.
Sixth, no indiscriminate revision of files and/ or to give own experience in the letter of inquiry when there is periodic revision of file information to avoid duplication and unnecessary correspondence.
Seventh, it is not permissible for the soliciting clients to make inquiries or references to direct competitors without frankly disclosing the nature of inquiry.
Now to make your question complete, I will write next week, some “ethical” guidelines concerning debt collection. For your information, the Bangko Sentral ng Pilipinas have already released a circular regarding limitations on debt collection practices particularly collection tactics being employed directly by either the creditor or third party collection agency. It was issued last September 2004 under CIRCULAR 454. The provisions included in the said circular place restrictions on debt collectors in connection with consumer debt. A consumer debtor is defined as any natural person obligated or allegedly obligated to pay any debt.
Editor’s Note: Mr. Ed F. Limtingco, is the VisMin Manager of CIBI Information, Inc., For credit & collection questions, he can be reached at 0917-7220521 or at elimtingco@cibi.net.ph