We welcome initiative to encourage prompt maintenance payments
A new service offered by a credit bureau will make maintenance payment records part of credit reports.
A failure to pay spousal or child support can now be recorded on an individual’s credit report. The DP SME Commercial Credit Bureau (the Bureau) has been designated by the Ministry of Community Development, Youth and Sports (MCYS) to be the first credit bureau for the purposes of receiving a report on unpaid maintenance arrears.
When MCYS consulted the public on proposed changes to the Women’s Charter in 2010, one of the central amendments suggested by AWARE was to set up a central body to collect maintenance payments. We believe that the services provided by the Bureau are a step in the right direction, as the risk of having a stain on your credit report will encourage more defaulters to meet their maintenance obligations on time.
A person who is owed a debt can approach the Bureau personally with the Court Order that states the maintenance arrears. The Bureau will record the debt and make the information available to members of the Bureau.
The Bureau’s membership consists of more than 700 companies, including leading banks, retailers, moneylenders and other credit providers.
The initiative is part of a suite of measures introduced by MCYS to improve the rate of compliance of maintenance orders. During the last four years, there were approximately 3,400 applications for enforcement of maintenance orders every year.
Ms Chen Yew Nah, managing director of the DP SME Commercial Credit Bureau, says the aim of the new reporting system is to encourage prompt payment of spousal and child support obligations.
“In Singapore most people place a great value on having a good credit standing. Knowing that a record of your matrimonial maintenance debts is kept by a credit bureau will motivate defaulters to keep up to date with their obligations.
“When an individual approaches a member of the Bureau seeking credit or to do business with them, a failure to honour a maintenance payment will show up as part of the credit check. It is up to each individual member of the Bureau to determine what they will do with the information.”
Separately, the Bureau will also be able to provide a range of optional services, which include providing mediation between the both parties to help settle disputes; issuing reminders on when and how to pay marital obligations; tracing the defaulter’s whereabouts if necessary; collecting payment and undertaking debt collection on behalf of maintenance recipients.
Each month, all the Bureau’s members provide details of the companies and individuals that owe them money, as well as which debts have been paid on time and which have not. This information is then fed into the DP SME Commercial Credit Bureau database so that a clearer picture of a debtor’s behaviour can be seen. Each of the Bureau’s 700-odd members can request a credit report on a company or an individual. Currently the DP SME Commercial Credit Bureau has more than 800,000 individual payment records of Singaporeans and Singapore businesses.
More information is available here.