By Providence Obuh

The Institute of Credit Administrators (ICA) Nigeria has called parties involved in credit transactions to be guided by a sense of values and ethics, stating that regulation alone is not enough for effective credit administration. ICA was set up in 1992 in response to a lax credit system characterized by a number of unethical business practices which were negatively affecting business cash flows.

President/Chairman of Council, ICA, Mr. Adetunji Oyebanji, said this at a press briefing prior to the inauguration of ICA’s 3rd Governing Council in Lagos, over the weekend. He noted that the present situation of credit lax has evidenced a gaping hole that should be occupied by values. “Integrity and honesty need to be the guiding principles in all business decisions. It is this responsibility towards the other party which will determine the well-being of credit in any economy,” he stated.

Oyebanji said that effective operation of a credit system in any economy is a pre-condition for enterprise and trade to develop and thrive, adding that for credit to boost the economy, it has to be sustainable and responsible. He further noted that the state of credit in any economy has important implications for both financial stability and private sector sustainability.

“In times of economic recovery which is still susceptible to external shocks, the well-being of credit is crucial for the economy. The poor attitude to credit, especially to public loans provided by government’s development financial institutions (DFIs) and lack of a robust regulatory regime for the DFI sector to operate is a fundamental threat to the health of any credit economy.” he said.