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If you've ever wondered what credit bureaus and what they're for, rest assured. Rest assured that you're not the first and you won't be the last. From now on, I'm going to answer these two important questions.

Credit bureaus are institutions that bring transparency to the relationship creditor-consumer acting impartially by providing information that assists in credit decision-making. By providing transparency, bureaus create healthy relationships of trust between lender and consumer or debtor, supporting credit discipline.

The work carried out by credit bureaus also contributes to two important disciplines: conscious consumption and responsible credit. The balance of these two disciplines creates a virtuous circle in credit by increasing the volume of credit at fair rates, which boosts the economy and social prosperity.

By analyzing the credit, the bureaus also help to prevent people from taking on more debt than they can afford and help creditors to minimize their losses from defaults. A company in financial difficulty because of default may have to delay paying employees and suppliers, who, because they haven't received the money they expected, are unable to honor their bills.

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By: Elias Sfeir President of ANBC & Member of the Climate Council of the City of São Paulo & Certified Advisor