In order for banks to meet with the Loans to Deposit Ratio (LDR) of 60 percent by September 30, the Bankers committee has arrived at a collective decision that loan defaulters will forgo their deposit assets in other bank accounts.
The Bankers’ committee which comprises of key officials of the Central Bank of Nigeria (CBN) and managing directors of deposit money banks (DMBs), said on the 26th of August that the funds seized will be used to make up for unpaid loans.
CBN’s Deputy Governor, Financial Services System, Aisha Ahmed, while speaking to journalists at the post bankers committee briefing in Lagos disclosed that the new rule will create room for trustworthy loaners thereby improving consumer credit in the long run and also make better purchasing power to stimulate economic growth.
According to Ahmed, the new rule will require the Bank Verification Number (BVN) of customers in each bank, also, customers will be made to sign an agreement that stipulates funds in accounts with other financial institutions be used to service loans when default occurs.
She noted that by utilizing the new rule, credit growth of N1 trillion is predicted to be added to the industry.
Speaking on how to make better credit access to the creative industry, Herbert Wigwe, Chief Executive Officer, Access Bank Plc, disclosed that the bankers will be partnering with the Lagos State Government in a pilot agreement geared towards creating adjourning areas of the National Theatre.
According to Wigwe, the banking industry has decided to support four main areas which are music, fashion, Nollywood and IT hubs, which is because of their vital role in the economy and their ability to engage a lot of the Nigerian youths.
He mentioned that the Nigerian Banks have recently succeeded in bringing down the ratio of industry Non-Performing Loans (NPLs) to a single digit.
Also speaking was the Director of Banking Supervision, Ahmed Abdullahi, who disclosed that credit scores henceforth will be obtained by which will aid banks in the rating obligors.
“If you are not creditworthy, you will not be able to access loans”, he said.
Meanwhile, the CBN spokesperson, Isaac Okorafor, has advised that the owner of small-scale businesses and also loan seekers to be careful of fraudulent loan offers purportedly by the Federal Government.
Okorafor, in a statement on Monday (August 26) said that the fraudsters send a mail to their victims requesting that they apply for loans provided by the Federal Government.
The CBN statement reads: “The attention of the Central Bank of Nigeria (CBN) has been drawn to fraudulent messages in the social media circles requesting unsuspecting loan seekers and owners of small-scale businesses to apply for loans provided by the Federal Government through an e-mail address ([email protected]) purportedly being handled by the Central Bank of Nigeria (CBN).
“While the CBN, indeed, has several development finance intervention programs from which different categories of businesses have benefitted (and still benefit), the bank DOES NOT do so through direct interaction with prospective applicants.
“For the avoidance of doubt, there are clearly spelled out procedures for accessing CBN intervention funds, which are disbursed through Participating Financial Institutions (PFIs), such as Deposit Money Banks (DMBs), Development Finance Institutions (DFIs) and Microfinance Banks (MFBs).
“Members of the public, particularly youth and owners of small-scale businesses are therefore advised to disregard any message requesting them to send their personal details, including mobile phone numbers, to emails such as [email protected] or any other one that may be contrived. These messages are fake and anyone who enters into correspondence with them does so at his or her own risk.
“Prospective applicants are advised to approach their respective banks or the Central Bank of Nigeria (CBN) branch nearest to them for clarification on the procedure for accessing any of the CBN-related loans”, the apex bank stated.