Kruk S.A.

In the first half of July the first group of debtors of the KRUK Group will be reported to the ERIF Register of Debtors. All those will be reported who will refuse to sign a settlement proposed by KRUK SA and to repay their debt in instalments. The register will also include data of those debtors who avoid any contact and negotiations concerning resolution of their debts.

The aim of the campaign including reporting debtor details to ERIF is to persuade debtors that it is worth contacting the creditor and agreeing terms of repayment amicably. Reporting debtor details to ERIF and the resulting unpleasant consequences including exclusion from many transactions on the market are an effective argument encouraging to sign a debt settlement.

Reporting the details of persons owing money to debt collection companies to the ERIF Register of Debtors is possible thanks to the new law on credit information reporting which came into effect on 14 June 2010. The new legislation regulating the operation of credit information bureaus has significantly extended the number of entities which may report a debt. Today, practically everyone who meets certain criteria listed in the act may report a debt to ERIF.

It is estimated that there are around 2.5 million people on the Polish market who have debts with secondary creditors (such as debt collection companies and securitization funds). A large number of them owe money to KRUK. Already at the end of May and beginning of June when the date of coming of the new law into effect was known, KRUK started sending demands for payment to debtors. Together with the demands, the debtors received a warning about the planned reporting of the debt to the ERIF Register of Debtors, which is required by the act. In total, by the end of June, close to 500,000 Poles received the above warnings sent by registered mail.

The study commissioned by the ERIF Register of Debtors shows that a growing number of Poles already know what credit information bureaus are and how they operate. Those who have the widest knowledge on credit information bureaus are ....debtors, i.e. people with debts. The above is one of the conclusions of the study titled “Poles’ knowledge about credit information bureaus and their attitudes to unpaid debts” conducted by MillwardBrown SMG/KRC. Close to a half of debtors have good or very good knowledge of the subject (47.8%).  The observations of the ERIF Register of Debtors indicate that it is the awareness of being reported to ERIF that is often the decisive factor in the debtors’ decision to repay the debt. People receiving warnings about possible reporting to ERIF know what to expect and they try to avoid the consequences by quickly making the past due payments or signing a settlement with the creditor.

“ERIF Register of Debtors is an effective prevention tool and, at the same time, an element of the debt collection process,” says Urszula Okarma, president of the board of ERIF BIG SA. ”Research shows that what best motivates for debt repayment is a court judgment and enforcement by court enforcement officer, as well as the potential loss of creditworthiness, reputation and credibility. And they are directly connected with reporting the debt to a credit information bureau. If a person is reported to such register it means that information about his/her debt is available on the market which hinders or prevents such debtor from taking new loans and has a negative impact on their image.”  
A study commissioned by the ERIF Register of Debtors confirms that being reported to ERIF is viewed by an average Pole as a serious sanction motivating for repayment of debts. The above is an opinion held by 82% of debtors (I completely agree – 40%, I rather agree – 42%). Among the general public (not only debtors) the above opinion about credit information bureaus is shared by 66,7% of respondents.