Whether disclosure of financial interest is a good or bad idea is the question. Many parties and companies have been debating over this very sensitive topic, and most of the time, a lot of people are against it. This is because this method involves more than just simple financial information, but even the smallest details on your financial information will be exposed. This includes bank statements, profit and loss statements, tax returns, pay stubs and many others.
As mentioned earlier, the creditor usually asks disclosure of financial interest to find out a person’s financial capability. This serves as a protection and both the debtor and creditor will benefit from it. If confidentiality is the primary concern of debtors, they have to understand that these types of information will not be used against anything except for that specific trade / transaction / application / sale that will be going on. The debtor’s total amount of owed money will be reflected, and it will also show whether that person was able to pay for the specific amount on time.
What are the other purposes of disclosure of financial interest? Unfortunately, there are a lot of debtors and people applying for loan who are trying to provide fraud bank statements. Some lenders require a bank statement of account for them to analyze the person’s capability of paying the borrowed amount. However, there are some people who have tried to come up with false bank statements, and unfortunately have gotten away with it. To avoid these from happening, stricter policies have been implemented, and the only way to get genuine papers and information is through disclosing these personal banking and finance information. This involves legal papers and other necessary steps to ensure that people will provide legit information and will not try to come up with falsified documents.
Is disclosure of financial interest a good idea? At first glance, it may seem like creditors are the only people who will take advantage of it – but in the long run, debtors will also benefit from it, and they can generally take this as a positive thing rather than as something that is being done against them. More about disclosure of financial interest can be found here: http://www.vdma.co.za/