Business
CBN extends grace period on intervention loans for one-year
The Central Bank of Nigeria (CBN) has extended its forbearance on intervention loans obtained from the apex bank. A new regulatory directive was issued following the expiration of the previous deadline.
In March 2020, CBN offered businesses COVID-19 palliatives in form of reduced interest rates on its intervention funds to companies from 9 percent to 5 percent per annum.
This was meant to assist businesses affected by the government’s measures against COVID-19 outbreak, and clear their financial constraint.
Read also: Default on collateralised loans worsened in fourth quarter –CBN
The reduced interest rate was meant to last for a year, same as the moratorium which was tied to the intervention loans. The low interest rate and the moratorium expired at the beginning of March 2021.
However, the CBN won’t enforce payment of debt, as the regulatory body extended the palliative by twelve months, until February 28, 2022.
But the grace provided by CBN won’t affect all debtors, only businesses that obtained CBN loans in Deposit Money Banks and credit facility from Bank of Industry (BOI).
“Following the expiration of the above timelines, the CBN hereby approves as follows: 1) The extension by another twelve (12) months to February 28, 2022 of the discounted interest rate for the CBN intervention facilities; 2) The roll-over of the moratorium on the above facilities shall be considered on a case by case basis.” CBN said in a statement on Wednesday.
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