Dubai’s leading computer traders explore stricter regulations to counter runaway retailers
The Dubai Computer Traders Group (DCTG), a non-profit organisation of Dubai’s leading IT and computer traders, today launched an ambitious initiative aimed at checking growing incidences of fraud within the IT industry and restoring confidence among the large IT community in Dubai.
Urging stricter norms and concerted action against defaulters, DCTG said that credit fraud is one of the major issues facing the UAE’s computer and IT industry and that many organisations have been badly hit when the defaulters fled the country.
At its general assembly held in Dubai this evening, DCTG launched a credit rating system and a code of ethics aimed at encouraging IT organisations to trade only with channel partners who are members of the DCTG. The event was sponsored by Netgear, a worldwide provider of technologically advanced and branded networking and storage products.
The credit ratings start from A for a member providing basic information to A+++ for a highly credible organisation providing maximum information.
Additionally, DCTG membership will also undergo a complete overhaul, with members being accepted into the group after a rigorous screening process and being continuously reviewed by the credit ratings system. Formed in 2007, DCTG currently has a core membership of 150 members and expected to reach 500 shortly.
Speaking at the event, Mr. Shailendra Rughwani, current President of DCTG, said, “The credit ratings system is a step in the right direction. It will help our members, distributors, vendors and international suppliers, identify the most credible partners to do business with and safeguard their organisations against fraud. With this system in place, members will be careful about making sure that their reputation remains intact in the market.”
The screening process involves cross-checking a potential member’s credentials, collection of the member’s information, including personal data from his home country and family details. Membership is approved only after DCTG’s examiners are confident that an applicant can add value to the group and after all information is proved to be credible.
The rising number of defaulting cases has shaken up the region’s IT industry and Rughwani pointed out that this year alone recorded the highest number of fraud cases in 15 years. Total losses in this year as a result of this trend is currently estimated at Dhs19 million, with frauds amounting to Dhs14 million committed in the past three weeks alone.
In his address, Mr. Mohamad Jomaa, Emcredit’s Business Development Manager – Commercial, said: “Amid the current economic challenges, businesses are fast realizing the power of credit information and its significance in developing a scientific approach to credit risk management. This achieved awareness is a key milestone; the implementation of advanced risk management methods based on comprehensive credit information is the next step forward.”
“Sharing credit and payment experiences can create a favourable trading environment, credit information sharing is a highly specialised service that requires vast expertise and appropriate legal and technical infrastructures. To this end, credit bureaus are critical to business success as they enable effective data-sharing practices,” Jomma said.
“Credit bureaus are specialised in delivering secure information sharing platforms through which credit information and payment experiences could be shared, such institutions help industry groups manage common risks through collective efforts,” he added.
Following the move, banks and insurance companies will also be in a better position to lend or insure IT companies who are members of the DCTG and enjoy reputable credit ratings.
