Senator Wants CBN, NIRSAL MFB To Stop COVID-19 Loan Recovery

Some senators are pushing for the Central Bank of Nigeria (CBN) and NIRSAL Micro Finance Bank (NIRSAL MFB) to abandon the recovery of credits given to Nigerians under the Targeted Credit Facility (TCF).

The Targeted Credit Facility (TCF) was credit given to Nigerians at the peak of the COVID-19 pandemic to mitigate the hardships suffered by individuals and businesses from loss of revenue and income.

The CBN supervised the disbursement of the facility while NIRSAL MFB was the disbursing agent.

NIRSAL MFB was summoned to appear before the Senate ad hoc committee investigating the allegation of uneven disbursement of loans, grants, interventions in the six-geopolitical regions.

After listening to NIRSAL MFB’s presentation, the senator representing Ondo Central Senatorial District, Ayo Akinyelure, stated that “NISRAL gave out these monies as grant to Nigerians”.

The lawmaker argued that he did not “see how you (NIRSAL MFB) are going to collect over N500 billion back from the criteria required for the acquisition of these loans. So, with these, if there is any recommendations or way forward that the management feels it can enlighten us on how it should put it out because we here are just micro when we go back to the Senate”.

He recommended that “since recovering this money will be difficult for NISRAL MFB, because of the time it was disbursed, let’s request that CBN should give them fresh funding so they can be able to give it out to persons that they can recover the money from”.

Akinyelure added: “The money, about, N188 billion outside, is gone and we can’t wait until it is recovered before another fund can be disbursed. Countries like the U.S gave their citizens free money about four times. So, for this agency to meet its objectives, fresh funds should be released to them.”

The senator hailed the Managing Director of NISRAL MFB on the funding summary he presented to the committee.

“It shows that the source of the funding is not from the CBN but from the Bankers’ committee and the 5 per cent profit by all commercial banks.

“The source is a guaranteed source of funding. NISRAL MFB has spread widely. So, my take is this: this agency needs to be encouraged by giving more funding to them because one of the major setbacks they had was COVID-19. Many people only collected the loan to eat.

“But after that, there’s what we call conventional targeted credit facility low interest. The previous loan was not well distributed in the country,” he said.

The Ondo Central senator suggested that “creations like this (NIRSAL MFB) should try and be differentiated from the CBN, as the CBN stands as a regulator for the Financial sector. And I don’t see why it will put itself in work with micro and macro sectors of the economy. I don’t think it is wise for us”.

He added: “NISRAL MFB’s objectives can be good and they have the advantage over other micro finance houses and the basis why the CBN registered micro finance houses is to be able to spread this to the local level.”

Akinyelure expressed worry that what NISRAL MFB is doing even though it has a national certificate, “conflicts with what the commercial banks are doing and it also conflicts with what some of the development banks are doing”.

He said: “From the presentation, we have seen you making reference to the kind of figures on that basis. I think we will not hesitate to make the right recommendations to the Senate on the ways forward, even if it means to leave the Bankers’ Committee to carry on. Then, they will come with their own criteria.”

Akinyelure called for continuous funding for the NIRSAL MFB, saying he was impressed by the bank’s spread across the country and the ability of small business owners to access quick and affordable loans without stringent conditions.  

THE NATION