The House of Representatives on Wednesday called on the Central Bank of Nigeria to restore the operational licences of 47 microfinance banks across the country.
The call was sequel to the adoption of a motion titled,
“Call to Investigate the Closure of some Microfinance Banks across the nation,”
moved by James Barka at the plenary.
Presenting the motion, Barka, who represents Hong Federal Constituency, Adamawa State, noted that on May 22, 2023, the CBN revoked the operational licence of 47 microfinance banks, nationwide including Biyama Microfinance Bank Ltd, Hong Local Government Area in Adamawa State.
He said: “The reasons cited in the communication include
that the banks were either inactive, insolvent, failed to render returns,
closed shop, or ceased to carry on the type of banking business for which they
were licensed for more than six months in contravention of the Banks and Other
Financial Institutions Act 2020.
“The closure of Biyama Microfinance Bank, which is the only
community bank in the Hong Local Government Area, has caused undue hardship to
the people who depended on the banking and financial services offered by the
bank for their small and medium enterprises.
“Closing down the only financial institution in a place
where the people go through so much hardship to earn stipends to deposit, or to
get small loans to run small businesses for survival would only frustrate them
further and may push them into crime in order to survive.
“Hong is one of the Local Government Areas that was ravaged
by Boko Haram insurgents, which left thousands of people without any means of
livelihood, thus a deliberate bias of economic stimulating activities in favour
of such communities would go a long way in helping to resuscitate their local
economy”.
Barka said after the recapitalisation of the Biyama
Microfinance Bank to the required N50 million share capital, the bank had been
in operation, making all required reports and returns.
“The board of the bank and other stakeholders have reviewed
the incident and written a formal complaint to the CBN, objecting to the
revocation of their licence as, since regular visits from the CBN, the bank has
never been accused of defaulting, neither has any examiner’s report been issued
to show that the bank has offended any law, rules or regulations of any of the
regulatory authorities.
“If the situation is not urgently resolved, the people will
resort to keeping their money at home, which makes them easy prey for armed
robbery and burglary.
“The people of Hong Local Government Area are predominantly
farmers, and the rainy season is their most active season, thus the matter
requires urgent attention”, he said.
Adopting the motion, the House mandated its Committee on
Banking and Currency (when constituted) to investigate the recent revocation of
the operational licences of microfinance banks across the country and report
back within four weeks for further legislative action.
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