Banks Begin Deduction Of Loans From Debtors’ Accounts

Banks Begin Deduction Of Loans From Debtors’ Accounts

The Central Bank of Nigeria has given the Deposit Money Banks go-ahead-order to recover debt owed by debtors from other accounts rather then the account and bank used to collect loan

The numbers of Non-performing Loans (NPL) in Deposit Money Banks have reached its epitome, making some financial institutions in need of fund for survival

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Data released shows that, the Non-performing Loans (NPL)

“The Deposit Money Banks are recovering debts owed by chronic debtors from their accounts in other banks to curb the growth of non-performing loans in the industry, findings have revealed.

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“Figures obtained from the Central Bank of Nigeria and the National Bureau of Statistics showed that the NPLs in the banks recorded a slight decline from N1.2tn at the end of second quarter of 2020 to N1.1tn at the end of July 2021”

 “On loosening, the committee felt that this would lower retail interest rates and improve the ability of obligors to repay their obligations, with a complementary reduction in NPLs,” it said.

“Recent data also show that stability has been maintained and a smooth functioning of financial intermediation ensured.

“CBN staff report indicates that the banking sector’s non-performing loan ratio has fallen from 6.3 per cent in February to 6.0 per cent in March and further to 5.9 per cent in April.”

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