CBN, NMfB Sweep Debtors’ Accounts to Recover Loans

The Central Bank of Nigeria (CBN), in conjunction with the NIRSAL Microfinance Bank, (NMFB) has started recovering their loans from Nigerians.

Yesterday, many Nigerians started receiving debit alerts from their phones by mid-afternoon.

The buzz was all over the place that the NMFB had started recovering facilities granted to Nigerians under the Targeted Credit Facility (TCF) and the Agric, Small and Medium Enterprise Scheme (AGSMEIS).

Although the recovery exercise had been in the offing for a while following threats by the CBN and NMFB, many beneficiaries of the loan were shocked at the sums harvested from their accounts.

The beneficiaries of the COVID-19 TCF and AGSMEIS facilities had their accounts placed on Global Standing Instruction (GSI).

The Global Standing Instruction (“GSI”) is a mandate authorising the recovery of due loan obligations from any and all deposit accounts maintained by a defaulting borrower with other banks other than the creditor bank.

One of the beneficiaries of the facilities, Mr. Kuma, cried out saying, “Why are they sweeping everything in people’s account?”

Mrs. Lizzy Atte said her children’s bank account was swept clean with only a balance of N657.14 left their account, with a note saying “GSI Recovery”.

Also targeted for loan recovery are defaulters of the Anchor Borrowers’ Programme (ABP), some of whom have already had their accounts debited.

In August 2022, the Central Bank of Nigeria (CBN) authorised NIRSAL Microfinance Bank to recover N5,840,450,992.08 non-performing loans from eight agric businesses who got loans under the Anchor Borrowers’ Programme (ABP).

The Anchor Borrowers’ Programme is intended to create a linkage between anchor companies involved in processing and small holder farmers (SHFs) of the required key agricultural commodities.

Under the TCF Household programme, 639,197 individuals received credit facilities valued at N258,167,332,386.38 while the SME component of the facility witnessed 112,921 Small and Medium Enterprises (SMEs) receiving loans valued at N112,203,609,105.94.

TCF Household beneficiaries received as little as N250,000 at the height of the COVID-19 pandemic to buy food and sustain themselves. Many beneficiaries lost their jobs and many more are still unemployed.

Mr. Philip Yila, Director Development Finance Department of the CBN, during the post Monetary Policy Committee (MPC), had vowed that “every single person who has taken that loan is going to pay. We have their BVN. In fact, we have started implementing the Global Standing Instruction (GSI)”.

“We will continue to poll the account in the bank that they lent to or whichever bank that they have account. Anytime we see money in that account, we will recover it.”

A source at the NIRSAL MFB (NMFB) told The Nation yesterday that defaulting beneficiaries of the facilities can walk into NMfB branches to restructure their loans.

The restructuring, the source said, will involve agreeing with the bank on when to start repayment and the amount affected debtors can afford to repay at agreed but convenient time.