IMPLICATIONS OF THE NEW CBN POLICY OF GSI

The CBN yesterday released a new policy called GSI (Global Standing Instruction). The policy is a very welcome policy. Below,  i try to summarize the major points of the policy. 

1. It applies to all financial institutions in the country.

2. If you take a loan in any bank (say GTB)  and you refuse to pay back, we would look for any other bank(s) in the country (say Access bank, and Sterling bank) where you have accounts and there is money, we would take the money from those accounts and pay GTB back. 

E.g you take 30k Loan from GTB and you fail to pay back. You have 10k in your Access bank account, 15k in your Sterling bank joint account with your wife and 8k in your child's First bank account that you help her manage (because she is still a minor). We would sweep the 15k in your Sterling bank joint account with your wife, sweep the 10k in your Access Bank, and take 5k out of the 8k you have in your child's First Bank account. We would send them all to GTB. The remaining 3k in your child's First Bank account  would not be touched. That's a promise. 

3. Even if its a joint account that your BVN is found on,  money would be moved from there!  

4. If we find out that you have an account that we should have moved money from but you have done chua-chua to not put your bvn on that account, then your BVN would be watchlisted. My brother, that is a major gbege!  You are finished!

5. Only principal and interest would be swept from your other accounts. Penalty charges would  not be included. CBN don try for us o. 

6. If a bank wrongfully activates GSI on you (you have not defaulted on your loan and they go make the system sweep from your other accounts) , the bank would pay a fine of 500k sharparly. No begging. 

7. If you complain about a wrongful activation of GSI on your accounts, and the bank claims you are wrong, you then decide to request for arbitration. If the arbiter rules that you are correct, then the bank pays a fine of 10M. No story! 

The GSI becomes effective from August 1st 2020.

This helps the system to fight serial loan defaulters and allows banks to more readily give out loans. As a matter of fact, a bank can now choose to give you a loan without you previously having an account with the bank. 

It's a new dawn in our country. 

 Otunba Fed