The Central Bank of Nigeria has begun debiting the account of its defaulters

Central Bank of Nigeria
  • The CBN is deducting money from defaulting states and farmers accounts
  • The CBN says it will show no mercy to those owing 
  • CBN also said it is making plans with the EFCC to recover its loans

The Central Bank of Nigeria is debiting the account of its defaulters under its development finance interventions.

The director of development finance of the CBN, Yusuf Yila, disclosed on Wednesday during a post-Monetary Policy Committee (MPC) in Abuja, that the apex bank has begun debiting its debtors accounts, particularly states and farmers who were beneficiaries of any of its interventions.

Anchor Borrowers Programme (ABP) and Commercial Agric Credit (CAC) are part of the intervention programmes.

He mentioned without specifying that state governments’ monthly federation account allocation committee (FAAC) accruals are already being debited directly every month.

“Every person(s) or state that took that loan (ABP) is going to pay. We have their BVN. These persons are smallholder farmers, who received funds for farming from state governments via the ABP, but have yet to pay them back.” He said.

Yila also hinted during his address that the ABP loan repayments were not as encouraging as the CAC’s which he commented was excellent.

He went on to fully elaborate on the extent of payments being made, debts still owed, and measures the bank is taking to ensure that the credits are being paid.

“Under the ABP, the CBN gave out about N1 trillion but recovered only N400 billion. But under the CAC, the bank lent out about N800 billion and recovered N700 billion.

We have started recovering loans from state governments. We have been doing a loan workout programme with them, and we are debiting their monthly FAAC accruals directly for the loans.

If a state government has taken N1 billion and is already in default, over six months, we debit them N150 million every month. So, we’ve started that programme.” He continued.

“So, every single loan that has been given out through any of our intervention programmes must be paid back.” He added.

Yila also mentioned that the banks has put sentiment aside and is determined to collect the money it is owed. He stated, “There is absolutely no mercy. We have started; we are in recovery mode. At the development finance department, we have begun to recover the loans.”

To ensure that these loans are fully recovered the Central Bank of Nigeria has solicited the assistance of the Economic and Financial Crimes Commission (EFCC).

“We are working with the EFCC. The CBN governor has approved the collaboration with the EFCC on loan recoveries.” Yila said.

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