Credit Reporting Systems and the International Economy  
Margaret J. Miller
The MIT Press
Credit reporting is a critical part of the financial system in most                  developed economies but is often weak or absent in developing countries. It                  addresses a fundamental problem of credit markets: asymmetric information between                  borrowers and lenders that can lead to adverse selection and moral hazard. The heart                  of a credit report is the record it provides of an individual's or a firm's payment                  history, which enables lenders to evaluate credit risk more accurately and lower                  loan processing time and costs. Credit reports also strengthen borrower discipline,                  since nonpayment with one institution results in sanctions with others.This book                  provides the first comprehensive review of credit reporting systems worldwide and                  documents the rapid growth in the industry. It offers empirical and theoretical                  evidence of the impact of credit reporting on financial markets, using examples from                  both developed and developing economies. Credit reporting, it shows, significantly                  contributes to predicting default risk of potential borrowers, which promotes                  increased lending activity. The book also covers the role of public policy in the                  development of credit reporting initiatives, including the role of public credit                  registries managed by central banks; and the role of legal, regulatory, and                  institutional factors in supporting credit reporting.