MFB Operator Identifies Multiple Borrowing As Sector’s Challenge

A micro finance operator in
Port Harcourt, Chief Christian Ogah has identified multiple borrowing by customers as a major challenge to the survival of the micro finance agencies and banks in the state and the country in general.
Ogah who is the Chief Executive Officer (CEO) of Ndunna Micro Finance Agency in an interaction with The Tide in Port Harcourt pointed out that such development  has become worrisome, inspite of the Central Bank of Nigeria’s effort at checking the trend by setting up the micro-credit outfits.
He said “The issue of multiple borrowing is a major problem in the industry. Customers go from one MFB to the other to access loan and it becomes a problem when it is time for payment”.
According to him, the high number of bad debts recorded by  micro finance institutions was to do with the attitude of not repaying loans by borrowers.
Ogah called on the CBN to put in place a re-financing institution that could re-finance the bad debts of these institutions, pending when a legal system is instituted in that regard.
He also explained that the duty of a refinancing institution would be to refinance bad loans and the borrower would repay the money over a period of time with interest, so as to sustain the institution.
The micro finance Chief executive also said that another way of minimizing the occurence of multiple borrowing is by asking customers to provide bank statements from their other bankers.
“This way, if a customer has already take a loan somewhere, it will be reflected in the bank’s stament and we will know”, he said.
Chief Ogah however, urged the micro finance operators to collaborate to eliminate the problem of multiple borrowing in the sector.

Corlins Walter