In a decisive move to tighten credit discipline and safeguard the stability of the Nigerian financial system, the Central Bank of Nigeria (CBN) has instructed all commercial banks to bar large loan defaulters from accessing fresh credit facilities and certain key banking services.
The directive, contained in a circular dated 12 March 2026 and signed by the Director of Banking Supervision, Olubukola A. Akinwunmi, is aimed at curtailing credit abuse by “large‑ticket obligors” whose outstanding debts have been classified as non‑performing loans (NPLs).
Under the new policy:
Borrowers with non‑performing loans recorded in the Central Bank’s Credit Risk Management System (CRMS) or with licensed private credit bureaus will be ineligible for additional credit facilities.
The restriction includes not only direct credit but also contingent banking services, such as letters of credit, performance bonds, advance payment guarantees and other financial instruments.
Banks are required to enhance collateral requirements and avoid extending further credit to these defaulters until their existing obligations are resolved.
The CBN says the policy applies specifically to large‑ticket borrowers — individuals or corporate entities whose combined exposures are significant enough to threaten a bank’s capital adequacy or pose systemic risk to the wider financial sector.
This action forms part of the apex bank’s broader mandate to uphold financial system soundness, protect depositors, and strengthen prudent risk management across Nigeria’s banking industry. It reinforces earlier regulatory measures — including a 2014 circular that similarly prohibited loan defaulters from accessing further credit — demonstrating continuity in the CBN’s efforts to address chronic loan default issues.
Analysts say the move is expected to pressure chronic defaulters to settle existing obligations, reduce the accumulation of non‑performing assets on bank balance sheets, and restore confidence in credit markets following prolonged concerns over rising default rates.
The CBN has said it will monitor compliance closely and that violations by financial institutions could attract sanctions under applicable banking laws.
