Financial Education

Our financial education section offers resources and information to help you learn more about personal finance and investing in order to achieve your financial goals.

What is credit history? Who are the persons related to the loan?

What is credit history?

Credit history refers to the information regarding a borrower's loans and their payment history. This data is electronically collected and stored in a centralized database maintained by a specialized organization called the Credit Information Bureau. It is important to note that credit history encompasses not only the loans borrowed by an individual but also information on loans guaranteed by them.

Lending institutions greatly value credit history as it indicates the borrower's track record in meeting their financial obligations in a timely manner. Banks, microfinance institutions, and other types of lenders exchange borrower data with the credit information bureau, in accordance with the relevant agreements signed with the borrower.

In Georgia, there is a single credit information bureau known as JSC Credit Information Bureau “Credit info” Georgia. Individuals have the option to request their credit history statement from the credit information bureau, and they are entitled to do so up to three times per year, free of charge.

Who are guarantors and what does guarantor mean?

A guarantor is an individual who assumes the responsibility, based on a contract, of repaying a loan taken by another person if the borrower fails to fulfill their repayment obligations. The guarantor serves as an additional guarantee for the lending organization, as they can be held liable for the debt if the borrower is unable to fulfill their loan obligation. Being a guarantor is a significant responsibility, and therefore, the person agreeing to be a guarantor should carefully assess both the borrower's financial capabilities and their own financial situation. It is crucial to consider the potential risks and implications before agreeing to become a guarantor.

Who is called a co-borrower?

You have the option to apply for a loan not only by yourself but also jointly with another individual, such as a family member. The co-borrower is a person who signs the loan agreement together with the primary borrower.

Taking out a loan is a significant financial decision that should be approached with responsibility. Nowadays, there are various financial organizations that offer loans, including banks, microfinance organizations, and lending institutions. It is the responsibility of each borrower to realistically assess their financial capabilities both at the time of borrowing and throughout the repayment period. It is important to gather detailed information about the loan offers from different organizations, compare them, and make an informed decision based on your needs and circumstances.