In line with the apex bank, the GIS guideline issued to boost loan restoration within the banking sector and to facilitate an improved credit reimbursement culture; reduce Non-Performing Loans within the banking industry; and watch-list consistent loan defaulters.
Accounts eligible for such seizure include particular person savings accounts, current accounts, domiciliary accounts, investment /deposit accounts in both Naira, foreign currencies; in addition to digital wallets and joint accounts.
The statement read in parts; “The GIS shall serve as the 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 deposit/investments held in the borrower’s qualifying bank accounts with participating bank accounts.”
Whereas the Nigeria Inter-Bank Settlement System (NIBSS) and the apex bank can be anticipated to work collectively for profitable implementation of the rules, it’s anticipated that every one banks must execute the GSI Mandate Agreement with the NIBSS and make sure that all qualifying accounts stay visible to NIBSS on the Industry Customer Accounts database.
Accounts of debtors should be linked to their Bank’s Verification Number (BVN), as failure to do so would appeal to such accounts being watch-listed when found.
It is usually anticipated that all banks will honour all balance inquiry and debit advice obtained from NIBSS for GSI Trigger in accordance with master agreement including GSI recall instructions.
Chief Executive Officers of banks have been directed to routinely update the Board of directors on the GSI process as it pertains to frequency of use and amounts recovered or released, and banks have also been ordered to report usually to the CBN on recoveries made via the GSI in addition to releases made to other banks.
Any creditor that violates the guidelines can be made to take full legal responsibility and pay a flat fine of N500m per incident.