CBN to expand borrowers’ database, orders banks to register on credit management system

The Central Bank of Nigeria (CBN) has asked all development finance institutions (DFIs), microfinance banks (MFBs), primary mortgage banks (PMBs) and finance companies (FCs) in the country to register on its credit risk management system (CRMS).

This is contained in a circular signed by Kevin Amugo, CBN’s director of financial policy and regulation department.

CRMS was established in 1991 to provide a central database from which consolidated credit information on borrowers could be obtained.

The apex bank said the inclusion of other financial institutions on the system was necessary after recording success with deposit money banks.

CBN said the banks are to provide information on all credit facilities, including principal and interest, on the CRMS.

“As part of the efforts to promote a safe and sound financial system in Nigeria, the CBN introduced the CRMS to improve credit risk management in commercial, merchant and non-interest banks as well as to prevent predatory borrowers from undermining the banking system. With the successful implementation of the CRMS in deposit money banks, it has become expedient to commence the enrollment of other financial institutions (OFIS) on the CRMS platform,” the circular reads.

“Accordingly, all DFIs, MFBs, PMBs and FCs are required to report ALL credit facilities (principal and interest) to the CRMS and to update same on monthly basis. OFIs shall note that Bank Verification Numbers (BVN) and Tax Identification Numbers (TIN) are the only basis for regulatory renditions.

“To ensure full compliance, OFIs are reminded to conclude the tagging of ALL live credit files for ALL individual aid non-individual borrowers with BVN and TIN respectively by May 14, 2021.”

CBN urged the financial institutions to acquaint themselves with regulatory provisions on CRMS.

It said appropriate sanctions will be applied to violators of the directive.

“Furthermore, the concerned OFIs are advised to acquaint themselves with the regulatory guidelines for the operations of the redesigned CRMS for commercial, merchant and non-interest banks in Nigeria (February 2017) and the additional regulatory guidelines of September 2017,” it reads.

“Kindly note that the CBN will monitor compliance with the requirements of this circular and non-compliance will attract appropriate sanctions.”