CBN: “Even Yahoo Boys” Cannot Borrow At Current Interest Rates – Sen Suswam Slams Apex Bank

The decision by the Central Bank of Nigeria, CBN, to hike the monetary policy Rates, MPR, has continued to take a hit among major stakeholders of the nation’s economy.

Former Governor Gabriel Suswam of Benue state is the latest in the in the country to criticised the CBN for raising the MPR also known as the benchmark interest rate, thus, highlighting the criticisms that have trailed the hike within the nation’s business community.

Suswam, a senator said on Channels Television on Monday that no business owner can borrow funds at this rate and still survive, stressing that some commercial banks charge as much as 33 percent on loans granted to customers

The Yemi Cardoso-led CBN had on September 24 announced the hike in the interest rates from 26.75 percent to 27.25 percent during the monthly Monetary policy committee, MPC in Abuja, the nation’s capital, citing the need to control inflation in the country.

The apex bank has raised the rate many times this year, according to checks by the magazine.

The decision, has however, received trenchant criticisms from economic experts who said the consistent increase is unwarranted in the face of the current economic situation in the country.

Ahead the hike last month, not a few economic experts, including renown expert Bismark Rewane of the Derivative Company Ltd predicted that the CBN will not tamper with the August rate of 26.75.

Also, economic experts have warned in a report published by Bloomberg that it will not be in Nigeria’s best interest for the rate to be raised further, as doing so will be unpopular, amidst concerns that a high interest rate will further impact businesses negatively.

Speaking today, Senator Suswam said no business owner can borrow at this rate and survive under the current economic realities in the country.

He said even “Yahoo Boys” also known as internet fraud stars cannot borrow loan at current rate, advising the CBN and other managers of Nigeria’s economy to seek proper advise on the way forward.

CBN Governor, Cardoso had while announcing the new rate disclosed that the MPC arrived at the decision in other to ensure price stability and checkmate inflation in the country.

“The committee was, however, unanimous in recognising that a lot more is required to actualise the bank’s price stability mandate,” he said.

“The MPC noted that even though headline inflation trended downwards due to a moderation in food inflation, core inflation has remained elevated, driven primarily by rising energy prices.

“The uptrend poses severe concerns to members as it clearly indicates the persistence of inflationary pressures. Members thus reiterated the need to work in close collaboration with the fiscal authority to address the current upward pressure on energy prices.

“The MPC noted the continued growth in money supply, recognising the need to curtail excess liquidity in the system as well as address foreign exchange demand pressures,” Cardoso said.