Credible risk: private credit bureaus and the work of loan officers in West Africa

Abstract

AbstractIn 2015, the Central Bank of West African States selected a private credit bureau to build a digital platform to collect and analyse financial data across the eight-country West African Economic and Monetary Union, including the activities of credit cooperatives and microfinance agencies that serve many West African borrowers. The credit-reporting platform promises to produce new and valuable knowledge about borrowers’ creditworthiness and risk. But valuable in what ways and for whom? Private credit bureaus rely on vast arrays of personal and financial data in order to produce credit reports and consumer credit scores that claim to represent the creditworthiness of individual borrowers. Cooperative loan officers, instead, understand creditworthiness to be highly variable and rely on relational metrics in order to determine risk as well as carefully overseeing existing loans to ensure their timely repayment. Based on ethnographic fieldwork with loan officers at a small-scale credit cooperative in Lomé, Togo, this article examines how the impending arrival of a private credit bureau and new credit-reporting technologies highlights the distinction between the ways in which credit bureaus and loan officers understand the nature of financial risk, as well as the centrality of loan officers and their management of borrower debt in sustaining the field of small-scale lending in Togo.