A financial expert, Mr. Obiora Unigwe, has appealed those money lenders should be incorporated into the new Global Standing Instructions (GSI) policy introduced for banks.
Unigwe, Chief Executive Officer, Surbpolitan Microfinance Bank, spoke at a Knowledge Sharing Webinar Series organized by Zuriel Nigeria on Friday in Lagos.
The topic was, ” The Future of Money Lending: Securing Your Financial Assets”.
He said that though money lenders were not financial institutions, the GSI would help with the five Cs of credit, particularly the character of the person (borrower).
The Newsmen reports that the GSI policy, introduced by CBN, became operational from Aug. 1, 2020.
The policy is part of measures to curtail the rising non-performing loans (NPLs) in the Nigerian banks and its impact on the industry.
Unigwe said: “Debt recovery process starts first from proper credit analysis; if you do not do proper credit analysis, the credit will go bad.
“But GSI will help with the five Cs of lending, the character of the person being a huge subject because the only thing we currently have is the bank statement of the borrower.
“So, GSI is the only thing that can give us a full-time assessment of how a customer behaves and where he/she has taken your money to.
“Once the customer knows that you can see where your money is kept, it will help shape their behavior as well as make recovery processes automated.”
The Chief Executive Officer of Carding Capital, Mr. Dapo Agboola, further called on the government to come to their rescue.
“This is where the state government needs to come in to protect the interests of the money lenders.
“Most state governments have banks they operate; the Lagos State Government, for instance, can instruct all money lenders in the state to partner with their banks.
“If they can take the bull by the horn to really protect our interests, it will be easy for us to apply GSI policy in our operations,” he said.
The Chief Operating Officer of Credit and Assets Limited, Dr. Adeyinka Adewusi, however, urged money lenders to apply precautionary measures that would help them get out of total loss.
He said especially such losses as opening a “sinking fund account ” to enable them to pay investors back their money.
The GSI, which encompasses an agreement between the banks and the CBN, grants authority to the former to debit loan defaulters from accounts they operated in other banks within Nigeria.
The new policy also allowed banks the latitude to debit the joint account a debtor held with a family member or business associate.