COVID-19 loans must be repaid, NIRSAL MFB insists

By Emma Ujah, Abuja Bureau Chief NIRSAL Microfinance Bank (NMFB) has clarified that the COVID-19 Targeted Credit Facility (TCF) was an intervention loan, not a grant, stressing that beneficiaries are obligated to repay the funds. The bank said deductions from the accounts of beneficiaries who accessed the facility would continue until their outstanding loans were fully liquidated, in line with the Global Standing Instruction (GSI) mechanism.

In a statement issued in Abuja at the weekend, the bank explained that the GSI framework allows financial institutions to recover outstanding loan obligations from eligible accounts linked to borrowers’ Bank Verification Numbers (BVNs), subject to applicable regulatory guidelines. The bank said the clarification became necessary to address concerns surrounding loan recoveries and reassure customers and members of the public of its commitment to transparency, accountability and responsible banking practices.

It explained that the COVID-19 Targeted Credit Facility was introduced by the Central Bank of Nigeria (CBN) to support households and businesses affected by the economic impact of the COVID-19 pandemic. According to the bank, all beneficiaries were required to accept electronic offer letters before disbursement, with the documents clearly outlining the terms and conditions of the facility, including repayment obligations and recovery mechanisms in cases of default.

“Regarding the recovery process, the Bank operates within the applicable regulatory framework, including the Global Standing Instruction (GSI) mechanism approved by the Central Bank of Nigeria,” it stated. NIRSAL MFB, however, acknowledged concerns raised by some beneficiaries over the timing and amounts of deductions, outstanding loan balances and access to repayment information.

The bank said it took the complaints seriously, noting that customers must have access to accurate information about their loan accounts. It stressed that the deductions were intended to settle outstanding contractual obligations, adding that beneficiaries who disputed deductions or identified discrepancies in their repayment records should contact the bank for individual account reconciliation.

“Where any beneficiary has concerns about deductions made, discrepancies in repayment records or the status of an outstanding balance, such cases should be brought to the bank’s attention for individual account reconciliation and appropriate resolution,” it said. The bank assured that legitimate complaints would be investigated and that any discrepancies established during the reconciliation process would receive the necessary attention.

It urged beneficiaries seeking clarification on their loan status, repayment history or outstanding obligations to contact the bank through its officially designated customer service channels.