Following an increase in the interest rate by 100 basis points to 16.5 per cent by the Central Bank of Nigeria (CBN) at its last Monetary Policy Committee meeting, commercial banks in the country have announced changes in the interest payment on loans collected by Nigerians.
In various emails and text messages to customers with existing loan contracts, the banks informed them about an upward review of the interest rate.
Depending on the banks, the upward review starts at 200 basis points or 2 per cent to about 30 per cent or higher, depending on the bank.
In a message by GTbank informing customers of the upward review of the interest, the bank said the decision was taken in view of the current money market conditions characterised by a general rise in interest rates.
“Upward review of interest rate on your naira facility. We write to notify you of the Bank’s decision to review the interest rate on your facility upwards. Please be assured of our appreciation of your esteemed patronage always. We will continue to provide updates on any future developments.”
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Speaking on the changes, The Director of the Centre for Promotion of Private Enterprise, Muda Yusuf, noted that CBN was creating a lot of problems for the economy rather than solving them.
“What Godwin Emefiele is after is to tighten monetary policy to reduce inflation and maybe reduce exchange rate. But as far as allowing market forces to determine the exchange rate, which is what many of us stand for, Emefiele is not ready for that.
“What he is doing is continuing to increase the interest rate, with the hope it will curb inflation and improve the Dollar exchange rate.
“He is not interested in allowing market forces to determine the rates. He is interested in allocating Dollars. Only God knows what criteria they are using to allocate foreign exchange. We have left the CBN and their principal to that.
“But we know that he is creating many problems for this economy, a very big problem. But that is the model he believes in,” said the former Director General of the Lagos Chamber of Commerce and Industry (LCCI).