NDIC strengthens agents to recover N1.5tr from failed bank debtors
NDIC Strengthens Debt Recovery Efforts to Recover N1.5 Trillion from Liquidated Banks
By Cynthia Alo
The Nigeria Deposit Insurance Corporation (NDIC) has intensified the roles of its debt recovery agents in an effort to recover approximately N1.5 trillion owed by liquidated Deposit Money Banks (DMBs) and Microfinance Banks (MfBs). This initiative aims to expedite reimbursements to depositors, including market women, small business owners, and Point-of-Sale (POS) operators adversely affected by recent bank failures.
Mr. Olufemi Kushimo, Director of the Legal Department at the NDIC, emphasized the importance of debt recovery during a seminar organized by the Corporation’s Legal and Asset Management Departments. The event was themed “Operationalizing the Provisions of the NDIC Act 2023 for Effective Debt Recovery.”
Kushimo highlighted that while the NDIC compensates insured deposits using its insurance fund, recovering outstanding debts is crucial for settling uninsured deposits and paying liquidation dividends.
“The work of the NDIC is to provide financial assistance and guarantee deposits. Debt recovery is essential for reimbursing depositors. We are able to pay insured deposits from our insurance fund, but recovering debts owed to the failed banks is vital for addressing the uninsured portion,” he stated.
He noted that many affected depositors are low-income earners with funds exceeding the insured limits. He stressed that timely debt recovery would enable the Corporation to pay liquidation dividends more efficiently.
Kushimo explained that the NDIC Act 2023 has strengthened the Corporation’s powers, providing enhanced enforcement mechanisms for more effective debt recovery.
“The Act has broadened our capabilities to recover debts from delinquent debtors, including insider-related accounts, and to identify criminal activities for prosecution by relevant agencies. Timely enforcement is critical due to the time value of money,” he added.
Mrs. Patricia Okosun, Director of the Asset Management Department, also addressed attendees, stating that the seminar’s objective was to equip recovery agents with new tools established under the Act.
“We now have an NDIC Act that fortifies debt recovery. The purpose of this seminar is to inform our recovery agents about the new provisions and resources available to them,” she said.
This initiative aims to not only enhance the recovery process but also improve the overall stability of Nigeria’s financial system.
