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NDIC to Recover N400Bn Debts Owed Failed Banks

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Nigeria Deposit Insurance Corporation (NDIC), is  prepared to wield the big stick in its ongoing efforts to recover over N400 billion owed by debtors of failed banks which are now in liquidation, according to Mr. Bello Hassan, managing director/chief executive of the corporation.

NDIC to Recover N400Bn Debts Owed Failed Banks

Hassan who stated this yesterday said debt recovery remained one of the greatest challenges hampering its deposit insurance operation.

He spoke to journalists at the opening of the 20th workshop for business editors and finance correspondents, with the theme: “Stocktaking of Deposit Insurance Practice: Assessing the Now, Evaluating the Challenges and Forecasting the Future” in Owerri, Imo State.

Hassan said the NDIC will leverage a bouquet of powers in its disposal, courtesy of the revised NDIC Act, 2023 to expedite the process of debt recovery, moving forward.

He said the non-recovery of debts was obstructing the smooth payment of many depositors of failed banks.

He said: “A lot of customers of banks in liquidation that borrowed are not willing to repay those debts. And I want to put it on record that those debts or those loans that were granted were granted out of deposits of people that were collected by the banks.

“So, it is only when those debtors pay back that the NDIC would now be able to pay the depositors of those failed banks. And that is one of the greatest challenges that we’re facing.

“Luckily enough, there is a review in the 2023 NDIC Act, a lot of powers have been given to the corporation in order to expedite this process. We are hoping to leverage that to ensure that we recover more so that we can pay those depositors.”

The NDIC boss, who put the total debt owed to institutions in liquidation at over N400 billion, including Deposit Money Banks (DMBs), Microfinance Banks (MFBs), and Primary Mortgage Institutions (PMIs), however pointed out that a substantial recovery had been made, while affected depositors had also been paid accordingly.

He added that substantial payments of the insured amounts had also been paid to depositors of banks whose licences were recently revoked earlier in May by the Central Bank of Nigeria (CBN).

Specifically, Hassan said over N1.6 billion had been disbursed to 40,000 depositors while further calling on other depositors who didn’t have a Bank Verification Number (BVN) attached to their bank accounts to come forward and be verified in order to access their insured deposits.

Commenting on the CBN’s proposed drive to recapitalise the banking industry, the NDIC MD said the move was inevitable in order to enable the banks to play adequately in the proposed $1 trillion- economy currently envisaged by the President Bola Tinubu administration.

He said: “You also need bigger banks to be able to play within that space.  As the government is implementing the agenda of growing the Gross Domestic Product (GDP) to beyond $1 trillion.

“You need bigger banks to be able to play in that space and I believe it is within that context that the CBN is looking at recapitalising banks. So, we await the CBN for further details on this recapitalisation process.”

Earlier in his opening remarks, Hassan said the corporation had introduced the Single Customer View (SCV) framework that has enhanced speedy payment of insured sums to depositors of closed banks.

Among other things, he said the corporation had also enhanced collaboration with the bar and the bench, leading to speedy dispensation of justice and more informed judgements on failed banks cases.

In addition , he stressed that the NDIC has put in place policy and framework on Alternative Dispute Resolution for out-of-court settlement, which had enabled it to resolve some hitherto protracted failed bank litigations.

He said: “We have reviewed the Framework for Differential Premium Assessment System (DPAS) to make it more risk sensitive and account for significant developments that have taken place in the Nigerian banking system since its adoption in 2008.”

He said in complementing the consumer protection efforts of the CBN, the corporation has enhanced public awareness on the benefits and limitations of the deposit insurance system and financial literacy to reduce the rate at which small depositors are being defrauded, thereby enhancing confidence in the banking system.

Hassan said: “We have invigorated our liquidation activities, and greatly increased debt recovery rate leading to declaration of 100 per cent liquidation dividends to depositors of over 20 deposit money banks in- liquidation.

“We have also improved our systems, processes and procedures to promote transparency and accountability in our operations, amongst other humble achievements.”

 

 


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E-Financial

Afreximbank Mulls Currency Trading Platform to Bridge $50bn Intra-Africa Trade Gap

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The African Export-Import Bank (Afreximbank) has announced plans to launch its currency trading platform in a bid to bridge the Intra-African trade financing gap estimated at over $50 billion annually.

The President and Chairman of Board of Directors, Afreximbank, Prof. Benedict Oramah disclosed this at the 8th Goddy Jidenma Foundation (GJF) biennial public lecture tagged, “The trade route to poverty reduction in Africa in a de-globalising world.”

He said plans are ongoing to launch the platform in May, 2024, stating the urgent need to aggressively fill the intra-African trade gap.

Afreximbank, he said, operates an intra-African Trade Division that has disbursed over $40 billion since 2016, with an amount of about $11 billion outstanding, equivalent to about 28 per cent of Afreximbank’s loan portfolio.

According to him, “The Currency Trading Platform will also be launched under the auspices of Pan-African payment and settlement system (PAPSS).

“It is now becoming possible for a small farmer in Malawi to use his cell phone to purchase a Nollywood streaming movie and pay in the Malawian Kwacha while the seller in Nigeria receives Naira. We are nearing the stage when an Egyptian can buy shares on the Nigerian Stock Exchange paying in Egyptian Pounds.”

The Afreximbank boss said access to trade and investment information is key, “as lack of access is perhaps the greatest impediment to intra-regional trade.”

To address this challenge, He said Afreximbank offers an Artificial Intelligence-enabled Trade Information Platform under the brand name Tradar Intelligence.

“It is for the same reason that Afreximbank collaborates with the African Union Commission (AUC), the AfCFTA Secretariat, and others to host a biennial intra-African trade Fair. The three editions so far held since 2018 attracted an aggregate of over 70,000 visitors, 4,000 exhibitors and about 120 billion US dollars in deals,” he said.

On the status of implementation, he said the African Continental Free Trade Agreement (AfCFTA) Secretariat is operational in Accra, Ghana where 54 countries have signed the Agreement, and 47 have ratified it.

“While much progress has been made, a lot is still required to ensure that trading under the Agreement is boosted. For example, to avoid its falling victim to the discontent that negatively impacted globalisation, the AfCFTA must be complimented by the Free movement of Africans across the continent, with the right to work.

Although 32 countries have signed the Treaty, only four countries ratified it, falling short of the required 15 ratifications for the Free Movement Protocol to enter into force. We must continue to make aggressive push for countries to ratify the Treaty so as to get the requisite ratifications for it to come into force,” he urged.

Also speaking, the Founder and Executive Secretary, GJF, Dr. Ije Jidenma, said there is a perfect congruence between Prof. Oramah’s Pan African vision and the GJF quest to be part of the national think tank and solution to the nation’s developmental challenges.

“Even though the developmental turf is tough, as a seasoned public intellectual and one with a great sense of history, Prof Oramah is one person that is not ready to give up hope about Africa’s renaissance,” she said.

On his part, the Chairman, Board of Trustees GJF, Pat Utomi, said the world has gone through rounds of globalisation, recession and war, advising that the challenge is for Nigeria to think outside the box on ways it cpuld prosper in this new swing in Africa.


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OPay Redefines Customer Service With Innovative Solutions, Expands Accessibility

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OPay, Nigeria’s leading financial technology company headquartered in Lagos, has revolutionized customer service by prioritizing user satisfaction and implementing cutting-edge solutions to enhance customer experiences.

OPay

OPay is pioneering a customer service revolution built on convenience and efficiency. Recognizing the diverse needs of its users, OPay offers a top-notch and seamless blend of physical and digital touchpoints, ensuring everyone receives the exceptional service they deserve.

With the company’s headquarters situated in Lagos, OPay has established a network of 17 customer service centers across the country, catering to individuals who prefer face-to-face interactions for their service-related queries and concerns.

This extensive network guarantees easy access to friendly support, a welcome respite from long queues and impersonal interactions. But OPay doesn’t stop there. For the users that prefer online enquiries and technical resolutions, a robust and responsive online customer service center awaits.

Users can access a wealth of self-service resources, chat with helpful Customer Service Agents (CSAs) via real-time Live Chat, and even report disputes directly through the App. No more frustrating hold times or inconvenient branch visits – OPay puts the power in user’s hands, wherever they are.

Mr. Dauda Gotring, Managing Director of OPay stated that, “Transparency and timely resolution are cornerstones of the OPay experience. Dispute issues like transfer or card problems are handled with diligence, with progress updates and a satisfying resolution timeline conveniently communicated within the App.”

He further added that, “With a dedicated team of over 500 Customer Service Agents, OPay ensures exceptional care around the clock. Whether you need a quick query answered or complex assistance, a friendly and knowledgeable representative is always just a click away.”

THE KEY FEATURES OF OPAY’S ENHANCED CUSTOMER SERVICE INCLUDE:

Progress Updates Through the App:

Customers now have the ability to report disputes directly through the OPay app. The company ensures transparency by updating customers on the progress of their reported issues, such as transfer disputes or card-related concerns, along with a well-defined resolution timeline. This feature empowers users with real-time information and reassurance during the resolution process.

Live Chat with OPay Customer Service Agents:

OPay has introduced a Live Chat option, available online 24/7, where customers can connect with more than 500 Customer Service Agents (CSAs). This instant and interactive channel allows users to seek assistance, resolve queries, and receive support at their convenience. The Live Chat feature underscores OPay’s commitment to accessible and responsive customer service.

As OPay continues to lead the way in financial technology, these customer-centric innovations solidify the company’s position as a trailblazer in the industry. By combining traditional face-to-face support with cutting-edge online solutions, OPay aims to create a seamless and satisfying experience for its diverse user base.


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CBN Raises BDC’s Share Capital to N2bn

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Central Bank of Nigeria (CBN) has proposed two categories of Bureau De Change (BDC) licence- Tier 1 and Tier 2- that would see the minimum capital requirement of operators in the former and latter categories pegged at N2 billion and N500 million respectively.

The apex bank stated this in the draft Revised Regulatory and Supervisory Guidelines for BDC operations in Nigeria posted on its website late on Friday.

Under the extant regulations, BDCs had to apply for a general license and have a minimum capital requirement of N35 million.

The new guidelines contain several new changes to the guidelines for BDC operations in the country. If approved, the new guidelines will be effective at a date that will be announced by the CBN.

Specifically, the proposed new guidelines state that: “Tier 1 BDC is authorized to operate on a national basis. It can open branches and may appoint franchisees, subject to the approval of the CBN. A Tier 1 BDC (which is the franchisor) shall exercise supervisory oversight over its franchisees. All franchisees shall adopt their franchisor’s name, branding, technology platform and rendition requirements.

“A Tier 2 BDC is authorized to operate only in one state or the FCT. It may have up to three locations – a head office and two branches, subject to approval of the CBN. It is not permitted to appoint franchisees.”

Furthermore, in addition to the N2 billion capital requirement, a Tier 1 BDC is expected to pay an N200 million mandatory caution deposit, N1 million non-refundable application fee, N5 million non-refundable license fee and N5 million non-refundable annual fee.

Tier 2 BDC operators, apart from N500 million minimum share capital, are expected to deposit a mandatory caution deposit of N50 million as well as non-refundable application and license fees of N250,000 and N2 million respectively.

In addition, Tier 2 BDCs are expected to pay a non-refundable annual fee of N1 million.

The apex bank also stated that the prescribed minimum capital of BDCs and any subsequent capital injection shall be subject to its verification.

On operators’ permissible and non-permissible activities, the new guidelines propose that BDCs should 25 per cent of foreign exchange purchased for Business Travel Allowance or Personal Travel Allowance in cash while the remaining 75 per cent should be transferred electronically to the customer’s Nigerian domiciliary account or prepaid card.

However, the guidelines said that customers receiving $500 or less than $500 should be paid fully in cash.

The guidelines also stipulate that BDCs should retrieve resident customers’ Bank Verification Numbers, (BVN), or Tax Identification Numbers, TIN before carrying out foreign exchange transactions.

Other highlights of the guidelines include: “A BDC or its franchisee shall not engage in the following activities: Street-trading, maintaining any type of account for any member of the public, including accepting any asset for safekeeping/custody; Taking deposits from or granting loans to members of the public in any currency and in any form;

“Retail sale of foreign currencies to non-individuals, except for BTA International outward transfers; Engaging in off-shore business or maintaining the foreign correspondent relationship with any foreign establishment; Opening or maintaining any account with any bank or financial institution outside Nigeria;

“Acting as custodian of foreign currency on behalf of customers; International inward transfers, except for operators that serve as cash-out points for IMTOs;

“Borrowing sums which in aggregate exceed the equivalent of 30 per cent of its shareholders’ funds unimpaired by losses, in the BDC’s audited financial statements of the preceding year;

“ Engaging in forwards, futures, options, or other derivative/speculative transactions; obtaining foreign exchange from sources other than those listed in Section 4.0;

“ Granting of loans and advances in any currency; selling foreign exchange on credit to any customer; engaging in any trade-related import activities and serving as payment or collection agents on behalf of customers.”


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