Guidelines on the Global Standing Instruction (GSI) issued by the Central Bank of Nigeria, has granted banks the right to seize loan defaulters’ money in other banks.
According to the apex bank, the GIS guideline was issued to enhance loan recovery in the banking sector and to facilitate an improved credit repayment culture; reduce Non-Performing Loans in the banking industry; and watch-list consistent loan defaulters.
Accounts eligible for such seizure include individual savings accounts, current accounts, domiciliary accounts, investment /deposit accounts in both Naira, foreign currencies; as well as electronic 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.”