Senate attacks CBN over high lending rates by banks

The Central Bank of Nigeria (CBN)  on Thursday came under acerbic attack of the Senate as the red chamber condemned the high lending rates in the country, accusing the apex bank of not encouraging investors with the monetary policy.

The Senate insisted that the CBN has not done enough in balancing the deposit interest rate and lending with the goal of encouraging savings.

The chamber expressed concern that with higher interest rates, interest payments on credit cards and loans are more expensive.

It said the development was thereby discouraging people from borrowing and spending.

The red chamber, therefore, mandated two of his committees to probe the CBN and the commercial banks involved in the monetary policy.

The committees are Finance and that of Banks, Insurance and other Financial institutions.

The decision was taken sequel to a motion by Senator Solomon Adeola representing Lagos West and Chairman of House of Representatives Committee on Public Accounts.

The motion titled, “Urgent need to bridge the gap between the lending interest rate and deposit Interest rate among commercial banks and other financial institutions”.

He said, “The latest data from the National Bureau of Statistics shows that the inflation rate further rose from 11.98 percent in December 2019 to 12.13 percent in 2020.

“This development negatively affects the deposits of commercial bank customers in addition to the low-interest rates on deposits.”