The Central Bank of Nigeria has formally prohibited large-ticket defaulters with non-performing loans from using banking services.
Following the comments that was made by CBN Governor, Olayemi Cardoso at the 4th Annual IMF/AFRITAC West 2 High-Level Executive Forum in Abuja, the central bank released a policy statement on Wednesday in a broad effort to impose credit discipline and protect the country’s financial system.
CBN Governor Olayemi Cardoso declared that the era of leniency toward delinquent borrowers has ended.
He stressed that the central bank is adopting a tougher approach to corporate governance, aimed at safeguarding the N4.61 trillion in new capital recently raised by the banking sector from potential misuse.
“Our stance on corporate governance is unequivocal: zero tolerance for violations. By ending years of regulatory forbearance, we have reinforced accountability, tightened supervision, and elevated compliance standards across the sector,” the Governor stated.
The directive focuses on “large-ticket defaulters”—individuals or entities with substantial non-performing loans recorded in the Credit Risk Management System. Under the new rules, these debtors will be blocked from obtaining new credit as well as key contingent liabilities and trade finance instruments.
“We have implemented a restriction of banking services to non-performing large-ticket defaulters. This decisive step underscores our commitment to credit discipline, financial integrity, and accountability,” the statement read.
The CBN said the measure is intended to foster a “culture of repayment,” which has often been absent among prominent borrowers. By restricting access to instruments like letters of credit and performance bonds, the regulator seeks to curb “credit jumping,” a practice in which defaulters move between banks to rack up additional debt.
“By curbing access to banking services for chronic defaulters, we are reinforcing the culture of repayment, protecting depositors, and safeguarding the stability of the financial system,” the apex bank added.
Beyond the clampdown on defaulters, Governor Cardoso reaffirmed that the CBN remains committed to orthodox monetary policy. This strategy focuses on maintaining price stability and relying on traditional tools to manage inflation expectations, rather than unconventional measures, in a bid to bolster confidence in the naira.
For years, Nigeria’s banking sector has grappled with “chronic defaulters”—affluent individuals or large corporations that borrow massive sums and fail to repay. Often called “large-ticket defaulters,” these borrowers pose serious risks to banks’ liquidity and the security of everyday depositors’ funds.
