Island Credit Solution, Inc., a credit rating assessor, has expanded its operations in the Philippines as the newest credit bureau aims to transform the country’s credit risk assessment system by making credit data more accessible, reliable, and technology-driven.

Island Credit was recently designated as a Special Accessing Entity (SAE) by the state-owned Credit Information Corporation (CIC), which is set to redefine financial inclusion by offering a suite of ready-to-use analytics tools designed for agile and scalable financial applications.

By integrating AI-driven analytics and alternative data sources, the company provides deeper credit insights not only for banks and fintech lenders but also for micro, small, and medium enterprises (MSMEs) and rural banks — sectors that often struggle to access credit.

In a statement, the company said it differentiates itself from traditional credit bureaus by leveraging advanced analytics and non-traditional data sources to create a comprehensive risk profile of borrowers.

Instead of relying solely on bank transaction histories, the company incorporates telecom usage, e-commerce activity, and digital transactions to assess creditworthiness more accurately.

At the core of this innovation is "PhilScore," a credit rating system designed to provide every Filipino with a unique and accessible credit profile using the CIC credit reports. This empowers individuals — especially those new to credit—to build and improve their financial standing while enabling lenders to make more informed decisions.

"Our goal is to bridge the gap between financial institutions and borrowers, particularly those who have been underserved or unbanked," said Hongcheng (Steven) Zhou, Deputy Chief Executive Officer of Island Credit Solution.  

"We offer fully digital services that cater not only to existing bank customers but also to those new to credit. By helping them start from zero, we contribute to a more inclusive financial system." 

 Breaking barriers in credit risk assessment

For years, the Philippine credit industry has faced challenges such as data fragmentation, outdated risk assessment models, and limited technological integration.

Many financial institutions struggle to maximize credit data due to technological constraints, often resulting in inefficient lending processes.

Zhou maintained that Island Credit Solution addresses these issues with its agile, SaaS-based plug-and-play solution, which allows banks, fintech lenders, and MSMEs to integrate advanced credit analytics into their decision-making processes without requiring extensive technical expertise.

In addition to credit scoring, the company operates on a Business-to-Business (B2B) and Business-to-Business-to-Customers (B2B2C) model, enabling loan applicants to be matched with alternative lenders with the correct risk appetite and best interest rate. This improves efficiency for lenders while increasing financial accessibility for borrowers.

"Our approach goes beyond standard credit reporting. By integrating financial and alternative data, we provide lenders with deeper insights while empowering individuals with greater financial opportunities," Zhou added. 

For his part, CIC President and CEO Ben Baltazar emphasized the need for more players in the market to improve credit access. "Many credit decisions in the Philippines are still not based on actual credit data. By accrediting new SAEs like Island Credit Solution, we are working to change that. The market is underserved, and we need innovative players to help expand access to credit," he said.

CIC’s partnership with Island Credit Solution is expected to accelerate the adoption of credit reports nationwide. PCEO Baltazar noted that in 2024, CIC generated 10 million credit reports, up from 5 million the previous year. However, with over 70 million borrowers and 300 million outstanding loan contracts, the potential for growth remains vast.

“I think it is not out of bounds to expect generating roughly around 20 million credit reports this year, if not more. But right now, we're confident that the credit market in the Philippines is a 100 million credit report market. That is something we can achieve in the coming years. But we won't be able to do that unless we work together and support the mass adoption of credit data for use in credit and even in valid cases of credit applications,” PCEO Baltazar added.