Friday, 01 March 2024 04:42

NDIC pays depositors of failed microfinance, mortgage banks

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Nigeria Deposit Insurance Corporation (NDIC) says it has reimbursed depositors of 179 microfinance banks (MFBs) and four primary mortgage banks (PMBs) that were recently shut down.

Bello Hassan, managing director (MD) and chief executive officer (CEO) of NDIC made this known at the ongoing 45th Kaduna International Trade Fair on Thursday.

He said the corporation has significantly improved its processes to ensure swift payment of insured sums to depositors in case of bank failure.

Hassan, who was represented at the occasion by Hauwa Jimeta, a senior official of the corporation, added that NDIC has continually strengthened its systems, processes, and procedures to enhance transparency and accountability across its operations.

“Notably, the corporation achieved remarkable success in reimbursing depositors during the recent closure of 179 microfinance banks (MFBs) and four primary mortgage banks (PMBs), ensuring timely payment of insured sums,” Hassan said.

“We also deployed digital remote payment strategies to facilitate electronic funds transfers to verified depositors’ alternate bank accounts.

“It is essential to emphasise that payments are ongoing, with depositors holding funds exceeding the insured limit set to receive liquidation dividends following debt recovery and asset sales.

“To address apathy among depositors with small balances, we launched the ‘Deposit Tracer’ initiative in partnership with a Mobile Money Operator 2 (MMO), enabling depositors to access their unpaid balances through mobile accounts.

“Furthermore, we have deployed a mobile application and updated our website for online claims processing, offering depositors the option of virtual verification during payout exercises.”

He further said NDIC  has introduced the “single customer view (SCV) framework to speed up payment to depositors of closed banks”.

Hassan said the priority of the corporation is to protect Nigerian depositors.

“We are dedicated to safeguarding depositors’ funds from the adverse effects of bank failure and complementing the Central Bank of Nigeria (CBN) in effectively supervising insured deposit-taking financial institutions and formulating sound banking policies,” he said

According to the CEO, NDIC has enhanced collaboration with the judiciary for speedy prosecution of failed insured institutions.

“This concerted effort has resulted in resolving long-drawn cases of closed banks such as Fortune and Triumph Banks in liquidation,” he said.

“Moreover, we have utilised alternative dispute resolution (ADR) mechanisms and out-of-court settlements, revitalising our liquidation activities.

“These efforts have significantly improved our debt recovery rate, enabling us to declare 100 per cent liquidation dividends to uninsured depositors of more than 20 deposit money banks in liquidation.”

Hassan, therefore, urged depositors of banks in liquidation to utilise these initiatives to claim their funds trapped in closed banks.

 

The Cable

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