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HomeLatestNigerians Refuse to Pay N261bn Covid Loans - CBN

Nigerians Refuse to Pay N261bn Covid Loans – CBN

Toba Owojaiye reporting

Abuja , Nigeria

Recent revelations regarding Nigeria’s financial landscape have unveiled a concerning reality: a significant portion of the Central Bank of Nigeria (CBN) and NIRSAL Microfinance Bank’s targeted credit facility (TCF) remains unpaid, leaving an outstanding debt of N261.07 billion.

Launched in April 2020 amidst the throes of the COVID-19 pandemic, the initiative aimed to alleviate the economic strain on households and small to medium-sized enterprises (SMEs), yet its efficacy now faces scrutiny.

Truth Live News gathered that, according to a comprehensive report, out of the N419.42 billion disbursed, only a fraction has been repaid, with N41.39 billion returned in principal and N174.60 million in interest payments. This leaves a daunting outstanding balance of N378.03 billion, highlighting the significant challenges in repayment encountered by many beneficiaries.

Notably, the initiative has contributed to the creation of over 1.5 million direct and indirect jobs, demonstrating its potential to stimulate Nigeria’s employment sector. However, the stark contrast between the funds disbursed and those repaid underscores a pressing need for more effective management and oversight.

Analysis of the beneficiaries reveals a mixed landscape, with only one entity, Centriculture Limited, classified as ‘performing’, having repaid a portion of its loan. The rest, predominantly SMEs, have been labeled as ‘non-performing’, raising questions about the program’s impact and sustainability.

In response to these challenges, experts advocate for integrating the TCF into existing schemes like the Agri-Business/Small and Medium Enterprise Investment Scheme (AgSMEIS) to enhance oversight and management. Additionally, the formulation of a clear exit strategy aligned with the outstanding balance is deemed essential for the orderly closure of the initiative.

Despite the setbacks, the CBN remains resolute in safeguarding Nigeria’s financial interests, reassuring citizens of the security of their bank deposits. However, public sentiment reflects a growing frustration, with some viewing the loan recovery efforts as overly stringent, given the initial perception of the loans as grants to alleviate pandemic-induced hardships.

Calls for the government to pursue outstanding loans owed by affluent individuals and facilitators who benefited from the scheme underscore a broader societal concern regarding financial transparency and accountability.

As Nigeria navigates the complexities of loan recovery amidst economic turbulence, the efficacy of its fiscal policies faces a critical litmus test.

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