IPMAN MfB seeks policy against loan defaulters

By PROVIDENCE OBUH

Ipman Satellite Microfinance Bank has urged the regulators of the sub-sector to enact a law to serve as a deterrent to loan defaulters, even as it stated that Microfinance Banks (MfBs) are suffering due to bad debt.

The bank is of the view that Nigerians find it difficult to pay back loans, given that they consider it as a national cake.

Managing Director of the bank, Mr. George Adetokunbo made the statement in a telephone conversation with Financial Vanguard.

Adetokunbo said, “An average Nigerian don’t pay back loan, whether to microfinance banks or to the bigger banks, they see it as a national cake. There must be a policy to punish people who borrow and fail to pay back.”

He said that the Central Bank of Nigeria (CBN) is not doing much, urging them to do more to ensure that MfBs are not seen as a bank where people come in and pick money and go back and relax, “make them realize that if you borrow, you must pay for it,” he said.

According to him, “In 2012 a legal action was filed against someone who borrowed some amount in 2007 from one of the MfB and have refused to pay back, do you know that the same person went back to sue the bank for human right.

He added that cases filed in the court are been delayed from six months to one year and adjourned until the bank gets fed up. Speaking on recapitalization, he said it would bring back sanity into the subsector, however, he lamented, “you recapitalize and people borrow without paying and you are left with nothing.

Some MfB have over N120 million out-side, in the name of loan, if they can get such money I don’t think we would be talking about recapitalization. MfBs are affected by bad loan. “CBN should not rush, recapitalisation is a good course, is just the situation of the country, there is no money. MfBs have lots of capital, but they are tied by borrowers,” he said.