Banks To Partner Credit Bureau Operators On CBN’s Loan Policy
Banks will be collaborating with credit bureau operators to achieve the Central Bank of Nigeria’s (CBN’s) 60 per cent Loan to Deposit Ratio (LDR) policy.
The CBN’s directive, expected to lead to more than N1.4 trillion in loans to customers, is in line with the apex bank’s commitment to boost economic growth through improved lending.
CRC Credit Bureau Managing Director/CEO, Tunde Popoola, who confirmed the development, said lenders were relying on data supplied by credit bureau operators to decide who gets a loan and at what rate.
Many customers have been receiving emails from their banks, asking them to take loans based on data supplied to them on such customers’ by credit bureaux.
Popoola said operators had deployed data mining tools and products that would enable them profile bank customers or help banks profile customers to determine if they could borrow.
Already, GTBank is using emails to encourage its customers that it would take only two minutes for them to get loan requests approved without collateral, and that there would be no hidden charges and are at single digit monthly lending rate.
The loan application could be done online. Other lenders are also advising customers to take loans.
Popoola said: “Historically, banks can look at your transactions and collect information from credit bureau operators, which they can put together and look for other additional information. They may have to generate information that will enable them to know whether you are credible to have loans, and what kind of loans, and how much you will be able to cope with based on the data that they have. Then of course, based on the credit score they are already familiar with, determine the rate at which the customer can access such loans.”
He said emails notification from banks to customers on availability of loans were products of well-thought out research and data mining on customers’ accounts. “They are not mistakingly sent emails. You will discover that the amount they tell you that you can have access to, will be different from what they give someone else. And so, because their risk profiles are different, they have been able to do that effectively, leveraging availability of data. I advise customers that have received such emails to approach the bank for the loans, but that is if you need the money,” he said.
Popoola said there was need to campaign more for people to know they can access loans. “Many banks are doing a lot to get customers to borrow. If a bank is not lending, such bank is also putting its assets at risk. We supply a lot of information to them because they approach us to get information on several thousands of their customers from time to time.There are even banks that are lending to people that are not directly their customers, leveraging data,” he said.
Continuing, he said: “It is easy to get loans nowadays if you really have need for it and if you order your priorities in a way you know you will be able to payback the loans. The danger is that you do not take loans, when you do not need such loans. We will keep campaigning on that. That is the risk with the rising campaign that people should come and take loans. People should be encouraged to take loans, only when they need the such loans.”
Popoola said people need loans to acquire assets to boost their businesses. “Secondly, people need loans to get consumer items that will improve the quality of their lives. A typical family needs a refrigerator in the house.That’s like a consumer loan, but it has an impact on the well-being and health of that family. But you do not need to take a loan to buy consumable items because that is consumption,” he said.
He added: “If I have the opportunity to take a loan, as a fashion designer to buy additional sewing machine, that will enhance my ability to deliver on the sewing jobs and meet customers’ needs. It can even be to buy a new equipment that will enable me do better designs. These are the loans that can propel people to do more in their lives. The good thing is that since we now have collateral registry, you can use the same assets to get an additional loan.’’