2014-07-01 | BSD/DIR/GEN/LAB/O7/015

Prohibition of Loan Defaulters from Further Access to Credit Facilities in the Nigerian Banking System

The Central Bank of Nigeria (CBN) has issued a directive prohibiting banks from granting further credit facilities to borrowers in default or with delinquent debts taken over by the Asset Management Company of Nigeria (AMCON). This applies to potential borrowers who have defaults of N500 million and above for deposit money banks, and N250 million for development banks. Banks must adhere to credit bureau checks before approving loans, report all credit facilities and their status on the Credit Risk Management System, and face penalties including a 150% provision if they contravene these directives. The CBN may review the prohibition threshold as necessary for maintaining responsible credit culture in borrowers.

Nigeria

Central Bank of Nigeria

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