Microfinance banks, fintechs and digital lenders say gaps in Nigeria’s loan recovery framework are worsening defaults, six years after the Central Bank of Nigeria introduced the Global Standing Instruction.
While commercial banks can recover overdue loans by debiting funds across a borrower’s bank accounts, other lenders remain excluded, a situation industry operators say has allowed serial defaulters to game the system.
The GSI, launched in 2020, was designed to strengthen credit discipline by enabling creditor banks to recover unpaid loans without requiring fresh consent from defaulting customers.
