The central bank has allowed commercial banks’ offshore banking units to use foreign currency deposits from expatriates as collateral for loans, provided the depositors give consent. Without consent, deposits cannot be used as collateral. If a borrower defaults, banks can notify depositors and recover the loan by mortgaging the deposit. This move aims to simplify loan collateral procedures. The directive is effective immediately and applies to loans given mainly to export zones and foreign-owned companies.
In the offshore banking units of commercial banks (which accept foreign currency deposits from abroad or expatriates and provide loans in foreign currency), the deposits placed by expatriates can be used as collateral for loans with their consent.
The ‘1 Nojor’ media platform is now live in beta, inviting users to explore and provide feedback as we continue to refine the experience.
