|NIRSAL Microfinance Bank’s Logo|
The Central Bank of Nigeria through the Nigerian Incentive-based Risk Sharing system for Agricultural Lending (NIRSAL) may decide to give it’s COVID-19 Loan defaulters harsh landing as it has all it takes to recover it’s money.
In March 2020, the Central Bank of Nigeria CBN announced that it has made available the sum of N50 billion as TCF (Targeted Credit Facility) to help families and Small and Medium Enterprises (SMEs) mitigate the negative effects of COVID-19 pandemic.
The fund was handed over to NIRSAL Micro Finance Bank where Households and SMEs were to obtained the Credit Facility. An online portal was unveiled for the public to submit application which would pass through series of reviews and be approved by the CBN and finally NIRSAL MFB will disburse the approved amount to the beneficiary.
After two years of grace, NIRSAL MFB asked beneficiaries of it’s Targeted Credit Facility (TCF) to honour their own side of the agreement by repaying their loans to the Bank. This call was countered by series of negative reactions from the public and possibly those who might have benefited from the funds.
There are several alternatives NIRSAL MFB/CBN may have to employ in order to get it’s funds back from the Beneficiaries of the TCF and these includes;
1. Using GSI: In August of 2020, the Central Bank announced that it has mandated Banks and other financial institutions the right to use it’s Global Standing Instruction. GSI gives Creditors (financial institutions) right to recover there money by debiting any account that the Borrower’s Bank Verification Number (BVN) is linked to. Be it a joint account, corporate account, Child’s account or his or her personal accounts with any Banks in Nigeria.
NIRSAL MFB may decide to employ this option to recover monies they’ve sold out to the public without security (collateral or guarantor).
2. Challenging Defaulters in the Court of Law: NIRSAL MFB has all exclusive rights to sue any defaulter of it’s TCF. Inasmuch as the contract was not signed in hard copy, it was signed in soft copy and can always be accessed by the Bank at anytime.
The bank has every right to challenge defaulters in the court at anytime.
3. Blacklisting Defaulters’ BVN: Using this option may prevent or hinder beneficiaries from accessing any loan in the future. Before issuing Loans these days, financial institutions perform a credit history check from Credit Bureau. Here they may get all the necessary information about your past Loans whether you repaid on time or you have been late or refused to payback entirely.
Those thinking they can get away with the loan are only deceiving themselves because you have the right to run but you can never hide from these facts. Except you decide to stop using banks which is totally difficult in this present age.
Avoid being tagged a chronic defaulter, for it may be difficult accessing similar funds in future times and you never can tell how desperately you may be.
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