Utility bills can enter Ecuador's credit bureau, but not immediately

Ecuador is set to integrate utility bill payments into its credit bureau system, a move that could provide a new avenue for individuals to establish or improve their credit history.

The Junta de Política y Regulación Financiera y Monetaria (JPRFM) has reformed regulations to allow payments for basic services like electricity and water to be considered as complementary credit information. This aims to offer a more comprehensive view of an individual's financial behavior and their capacity to manage debt.

However, consumers should note that late payments on utility bills will not result in an automatic drop in their credit score. The implementation of this new system will be gradual, with regulatory bodies given up to 18 months to establish the required mechanisms. Additionally, the use of this data must comply with personal data protection laws.

Beyond the inclusion of utility bills, the reform also shortens the maximum period for retaining certain credit risk information from six years to four. This change could benefit individuals who have experienced past financial difficulties but have since improved their financial standing. Experts suggest that incorporating utility payments could be particularly helpful for those with limited existing credit history, as consistent payments may offer new insights into their payment behavior. Nevertheless, experts caution that paying utility bills on time alone does not guarantee loan approval, as credit evaluations will continue to consider multiple factors.