Banks Operate Black Market For Loan Collateral, Says Industry Group

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The National Association of Small Scale Industrialists, NASSI, has accused banks of creating and sustaining black markets for loans collaterals.

Speaking at the first National Stakeholders Conference of Association of Corporate Affairs Managers of Banks (ACAMB), held in Lagos, Director General of NASSI, Mr. Ifeanyi Oputa, said most of the collaterals accepted by banks for loans are from the black market.

Giving further insight Oputa explained: “To get this black market collateral you pay 10% or 20% worth of the loan to the owner of the security (collateral), while you pay 25% or 30% to the bank (as interest rate). So you have lost 45% – 50% of the loan already and the business has not started. The bankers know, if they claim they do not know that is a blatant lie.”

Banks Operate Black Market For Loan Collateral, Says Industry Group

Also speaking at the conference, the Chairperson of the Agriculture and Allied Group of the Lagos Chamber of Commerce and Industry, LCCI, Edobong Akpabio, lamented the poor relationship between the banks and the agricultural sector, which she stressed is due to lack of understanding of the sector.

The conference, themed, “Promoting Synergy between the Banking Industry and the Organized Private Sector”, was organized to correct perceived misunderstandings between the two sectors and to proffer common grounds that would foster understanding and progress.