Here are the reasons why.įirst, in 1992, I worked in the same office building with Peoples Bank at 200, Igbosere Road, Lagos. Most of the outstanding loans will never be recovered. Experience with Nigerians and their attitudes to “government money” will lead to a sad prediction. Simple arithmetic tells us that only 25 per cent had been repaid while 75 per cent of the loans disbursed is outstanding.Ĭommonsense also tells us that the programme is in deep trouble. The report also acknowledged that N463bn was outstanding. “For the Anchor Borrowers Programme, the sum of 615.4bn had been disbursed to 3,038,899 beneficiaries, out of which, N152.3bn was repaid.” - CBN Report. Let me elaborate now.ĪBP is a pupulist idea with serial failures ABP was fundamentally flawed because it was offering “government money” to the most risky borrowers. Only God knows how many initiatives could have succeeded if only the promoter had paused to listen to those with questions to ask or suggestions to make. We might learn something that would save us and our project or reputation.įriends, subordinates, staff, political allies etc seldom tell a leader the whole truth - if they know that it will be rejected.
We should actually listen carefully to them. Rosenblat, VANGUARD BOOK OF QUOTATIONS, VBQ p 48.Īnd, even if the critics are enemies, a wise philosopher has reminded us what we should do with our adversaries. They offer a criticism of one’s conduct, albeit unsought, that is not always provided by friends.” “Like all God’s creatures, enemies have a purpose in the world. However, before explaining why a major loss is inevitable, permit me to make a comment (or is it an appeal?) which governments should always bear in mind. As things stand right now, and, I will elaborate on that, most of the loans now overdue will never be repaid. There is a lesson for the current FG and CBN in the rise and fall of PBN. By the time Babangida stepped aside in 1993, PBN was finished as a project. Thereafter, most borrowers stopped paying back. But, soon the attitude that each recipient had received a share of the “national cake” became prevalent.” Perhaps in the beginning the borrowers intended to pay back.
“In Nigeria, anything called “government money” inevitably induces the alley cat’s instincts for fish in the people. Politics intruded too much into banking business.įinally, “In Bangladesh, a relatively poor country, governments had very little money for people to embezzle. That was the second reason for its collapse. PBN also started big with branches in all the state capitals. The PBN, which was set up to achieve the same goals as Grameen, was a government-owned bank. It was a private bank started very small and eventually grew big. Micro-credit financing originated in Bangladesh when Grameen Bank was established to give loans as small as $1 to rural women, mostly, for petty trading. What follows is a summary of what I have already published in IBRAHIM B BABANGIDA 1985-1992: LETTING A THOUSAND FLOWERS BLOOM.
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