CBN To Clamp Down On Bad Debtors To OFIs
The Central Bank of Nigeria has said it will extend its Credit Risk Management System to the other financial institutions in the country to protect them from bad debtors.
It said this became imperative after it had successfully implemented it in other lending institutions in the country.
The CBN said this in a circular signed by the Director, Financial Policy and Regulation Department, Kelvin Amugo, titled ‘Credit Risk Management System: Commencement of enrolment of all Development Finance Institutions, Microfinance Banks, Primary Mortgage Banks and Finance Companies’ on Monday.
Part of the circular read, “As part of efforts to promote a safe and sound financial system in Nigeria, the CBN introduced the CRMS to improve credit risk management in commercial, merchant and non-interest banks as well as to prevent predatory borrowers from undermining the banking system.
“With the successful implementation of the CRMS in deposit money banks, it has become expedient to commence the enrolment of Other Financial Institutions on the CTMS platform.
“Accordingly, all DFIs, MfBs, PMBs and FCs are required to report all credit facilities (principal and interest) to the CRMs and to update same on monthly basis.
“OFIs shall note the Bank Verification Numbers and Tax Identification Numbers are the only basis for regulatory renditions”