Presidency, Senate to Collaborate on Legal Framework for Credit Information Sharing with Credit Bureaus

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Omololu Ogunmade in Abuja
The Senate in collaboration with the presidency has initiated moves to work on a legal framework meant to facilitate credit information sharing between credit bureaus and lenders.

Speaking at a one-day public hearing in National Assembly organised by Senate Committee on Banking, Insurance and Other Financial Institutions, the Acting President, Prof. Yemi Osibanjo, said repositioning credit facilities through legislation would facilitate credit information sharing between the credit bureaus and lenders such as banks and financial institutions. He added that the development would increase the availability of credit and also reduce its cost.

The acting president who was represented by Dr. Jumoke Wole at the hearing, said to achieve the drive for a favourable business environment, a Presidential and Business Environment Council had been established by President Muhammadu Buhari last year to foster a favourable business environment in Nigeria.

He said the committee was also expected to identify the constraints and restrictions which serve as obstacles to ease of doing business in Nigeria and for the development of the economy.
The council, he added, is chaired by his office and consist of 10 ministers, the head of service and Central Bank of Nigeria (CBN).

He urged the Senate to send a representation from the National Assembly to the council.
In his remarks, the Senate President, Bukola Saraki, said the Eight Senate was committed to reviewing laws affecting Nigerian business environment, adding: “This is in order to give the private sector a lift as the main driver of economic development.”
He also said the Senate had come up with three bills, viz: “The Legal Framework for Credit Bureau Services Bill 2017 (SB 205); The National Payment System Bill, 2017 (SB 005) and “The Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, CAP F34 LFN, 2004 (Amendment) Bill, 2017 (SB181).”

Saraki explained that the purpose of these priority bills was to open the economic space to attract greater private sector investmentw especially those that enable small business investments to thrive and create more jobs for our people within a friendly business climate.

He said: “The Legal Framework for Credit Bureau Services Bill, 2017 one of the priority bills we have listed here, seeks to promote the use of credit information, access to finance, knowledge of credit bureaus to improve the lending environment in Nigeria.

“This bill adds a very critical scheme that will aid Credit Risk Management and reduce significantly the incidence of Non-performing Loan Portfolio in the system.
“This bill goes beyond being an assessment tool for financial inclusion, it is a social re-engineering tool that will soon be useful to both the labour market and the education sector in the evaluation of behaviour and performance in such a manner that reduces risks across all baselines.”

The Senate President further noted that the bill especially seeks to remove the clog on the wheel of access to credit, saying  “the implication is the expansion of the band of those technically able to access credit through a more scientific, objective, less subjective and neutral review as credit houses will now have the tools to provide credits to Nigerians for economic activities that have direct positive impact on the national economy more readily and in a cost effective way having reduced to the barest minimum the risk of default through delinquent behaviours”

The National Payment System Bill, 2016, he added,  is another important bill that the Senate has identified through the report of the technical committee on the review of business laws. This bill is slated as a critical framework necessary to help modernize the Nigerian financial services market.

According to him, “The bill aims at providing the regulatory oversight of the National Payments System. It will engender a veritable scheme for controlling and monitoring payment institutions, authorities to ensure that at all times they serve the best interest of the consumers’ and ensure the licensing process is transparent and efficient.

Earlier in his address, chairman Senate Committee on Banking Insurance and other Financial Institutions, Senator Rafiu Ibrahim promised that inputs from stakeholders in the banking and other financial institutions would aid the Senate to come out with legislations that could lead the country out of the present economic woes.