… As GSI guidelines takes off 1st August
By LINDA JACOBS, Lagos
The Central Bank of Nigeria (CBN) today moved a step ahead of bank loan defaulters with a new guideline that allows seizing of their funds in other accounts.
According to the Asset Management Corporation of Nigeria (AMCON), 105 debtors were responsible for about Naira 4.5 trillion debt affecting the financial health of the Nigeria banking industry.
According the apex bank’s operational guidelines for Global Standing Instruction (GSI), this allows financial institutions to access funds of defaulting debtors that are deposited in other banks with effect from August 1, 2020.
The Global Standing Instruction, which is a mandate authorizing recovery of past due obligations from any and all deposit accounts maintained by a defaulter. The GSI is limited to debt recovery only and is limited to only individual accounts. Although it can be used recovery of repayment amount, the GSI cannot be used to recover any additional fees, charges or penal rate for default.
In a circular issued by the CBN Director, Financial Policy and Regulation Department, Kevin Amugo the GSI is targeted at facilitating an improved credit repayment system, reducing non-performing loans in the Nigerian banking system and watch-listing consistent loan defaulters.
The CBN in collaboration with stakeholders had last year developed the necessary protocls to facilitate a seamless implementation of the GSI process, including eligible loans granted from August 28, 2019.
Accordingly, it had issued the guideline to regulate the operations of the GSI which will be implemented with effect from August 1, 2020, as a way to enhance loan recovery across the banking sector.
The guideline states that 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.
To set up the mandate, customers will fill in their BVN, Credit Risk Management System (CRMS) number, the full repayment amount, the loan duration and the repayment account. The GSI is being maintained by NIBSS which is the custodian of BVN and holds records of all bank accounts in the country.
Once a debtor defaults on a loan, the GSI is triggered with the creditor bank activating the mandate on GSI Module specifying the recovery amount. Once triggered, the available accounts for recovery are identified, available balances for the accounts are retrieved and funds from the accounts according to Recover Logic are recovered.
Participating financial institutions by the GSI mandate must honor all transactions from NIBSS with a valid GSI Mandate code. The GSI Transactions can be triggered upon default on repayment, seven days after scheduled repayment date or before application of penal rates.
The UnionX Innovation Challenge is Open for Entries
Up to N4.5m Funding up for Grabs!!
Union Bank has unveiled the 2021 UnionX Innovation Challenge support early-stage start-ups and boost innovation within the start-up ecosystem.
Tagged ‘A New Discovery’, this edition of the UnionX Challenge, will focus on discovering, showcasing, and supporting eligible entrepreneurs with innovative, technology-focused Minimum Viable Products (MVPs).
During the entry period which ends on March 14, 2021, early-stage start-ups registered in Nigeria are invited to submit innovative MVPs with the potential to transform society. These innovative MVPs should focus on sectors including, but not limited to, Financial Technology, E-Commerce, Health, Education and Agriculture.
The top three MVPs will receive cash prizes totaling N4.5million from Union Bank, in addition to a 2-month incubation programme with GreenHouse Capital, a leading fintech venture capital fund collaborating with Union Bank on the initiative.
In addition, the winners will leverage Union Bank’s network and value chain to further develop their solutions and scale for greater impact. They will also benefit from a range of services focused on product development, distribution and business modelling geared towards potential integration with the Bank.
The UnionX Challenge is the most recent in Union Bank’s Innovation Challenge series. Through the Centenary Innovation Challenge in 2017, the Campus Innovation Challenge in 2018, and the 2019 Edtech Challenge, Union Bank has discovered and supported innovative start-ups and solutions with the potential to drive sustainable impact and development in Nigeria.
Terms and conditions apply.
Former Governor, Bank of England Carney Joins Stripe Board
Former governor of the bank of England Mark Carney has joined the Board of directors of hot Web payments firm Stripe.
Ten years since launching, Stripe’s infrastructure powers hundreds of billions of euros of payments for businesses in over 140 countries and territories around the world.
The company, which last raised a $600 million series G in mid-2020, is currently contemplating an IPO that would give it a valuation of $105 billion.
Says Carney: “The very nature of commerce has changed over the past decade. Stripe has been at the forefront of enabling this new digital economy, providing innovative and resilient global payment solutions to businesses large and small. In the process, Stripe has been breaking down barriers to global trade and accelerating economic output.”
The former governor of the Bank of England is currently playing a key role in the battle against global warming as the UN Special Envoy for Climate Action.
Stripe says it expects to benefit from Carney’s leardership role in sustainable finance as it rolls out a global climate effort, enabling millions of businesses to bring more funding to emerging carbon removal technologies,
“As Stripe enters its second decade, Mark’s unparalleled experience of the highest levels of financial services and central banking will be of enormous benefit as we work to grow the GDP of the internet.” says John Collison, co-founder and president of Stripe. “From his desire to see faster settlement systems to his commitment to climate change mitigation, Mark’s values align with ours. We’re delighted he’s joining our Board of Directors.”
LaPRIGA Awards Recognises MTN Nigeria For Community Relations
Leading telecommunications services provider, MTN Nigeria has been recognised for best practices in Community Relations efforts through its social investment arm, MTN Foundation, at the fifth edition of the Lagos Public Relations Industry Gala and Awards (LaPRIGA).
The annual event organized by the Lagos State Chapter of the Nigerian Institute of Public Relations (NIPR) was created to celebrate exemplary practices, professional accomplishments and long-standing leadership roles of stakeholders, PR practitioners, the media and corporate organisations. Through the awards, the Lagos State Chapter of NIPR aims to boost adoption of global best practices while in turn increasing awareness for the role of PR.
Commenting on the recognition of MTN Foundation’s efforts, Nonny Ugboma, Executive Secretary, appreciated the Lagos State chapter of NIPR for recognising MTN Foundation’s impact in over 500 communities across Nigeria. According to her, “We understand the crucial role PR practitioners play in strengthening relationships between corporate organisations and their stakeholders. At MTN Nigeria, we have enjoyed mutually beneficial relationships with media practitioners through which we have been able to reach more host communities with our health, education and economic empowerment projects.”
“We are honoured to not only receive this award but to have been nominated alongside other outstanding organisations. We remain committed to improving quality of life for Nigerians on a sustainable basis.” She added.
In 2019, MTN won two LaPRIGA awards for best in Crisis Management and Excellence in Internal Communication, this is in addition to a long list of decorations for the brand this year, including the 2020 Nigeria Risk awards for the most responsive organisation to the Covid-19 crisis, brand of the year at the Marketing Edge and Brandcom awards, Investors in People Employer of the Year awards, among others. Since inception, the Foundation has spent over N22 billion in 852 people-centred projects across the 36 states and the FCT, and impacted over 18.6 million lives.
Established in 1963, the Nigerian Institute of Public Relations (NIPR), is the non-governmental, not-for-profit professional body of qualified Public Relations practitioners chartered by Decree 16 of June 1990 (now an Act of the Federal Republic of Nigeria) to regulate the practice and direct its development.
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