Worry For Debtors As CBN Threatens To Deduct Money From Their Bank Accounts

CBN Threatens To Deduct Money From Debtors' Bank Accounts

Loan defaulters under the Anchor Borrower Programme (ABP), may have a lot to worry about, as the Central Bank of Nigeria (CBN) threatened to deduct money from their bank accounts directly.

CBN Senior Manager, Development Finance Office, Port-Harcourt, Celsus Agla, made this submission in a meeting with maize farmers and other stakeholders.

While lamenting some farmers that obtained loan through the ABP have ignored appeals to repay, and some describe the loan as grant, Agla disclosed that the ape bank is considering the Global Standing Instruction (GSI).

Why GSI Is last resort for CBN

The GSI allows banks to deduct money from accounts of loan defaulters to settle their debt, “the GSI is a system whereby if you have an account with any bank outside say Unity Bank and there’s money in that account; because your BVN is attached to these loans if the GSI is triggered, the monies in those accounts can be collected to repay the loan to Unity Bank,” he explained.

“The GSI shall serve as a last resort by a creditor bank, without recourse to the borrower, to recover past due obligations (principal and Accrued Interest only, excluding any penal charges) from a defaulting borrower through a direct set-off from deposits, investments held in the borrower’s qualifying bank accounts with participating financial institutions,” the CBN chief maintained.

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