Nigeria’s statutory body for the control, supervision and regulation of credit management profession, the National Institute of Credit Administration, have urged credit management professionals across industries in the economy to strictly observe ethics, transparency, and duty of care in their handling of customer credit appraisal process.
Registrar/Chief Executive Officer of NICA, Prof. Chris Onalo, who gave the advice yesterday, said that the attributes are necessary for a sound credit system.
Onalo said: “When we talk about being ethical, transparent and carrying out duty of care to make sure that credit appraisal processes are transparent, we are looking to keep credit professionals on their toes by being very professional, ethical and transparent.
“This is against the backdrop of credit possibly going bad as a result of unethical conducts, some of which may not be economically motivated, but could be factors that can be prevented.
“When a credit professional is appraising a customer for either credit line, credit review, or credit limit upgrade, the customer must be thoroughly assessed based on the knowledge of the customer and the industry that the credit professional has had.”
According to him, credit assessment, appraisal or evaluation must put into consideration the business growth, or business downturn experience that the credit professional may have observed with the customer over time.
“This is important so that what the credit professional sees at the end of the day, or at any time, is how the credit customers’ business can continuously be positioned and repositioned for growth, expansion and sustainable contribution to the economy.
“If a credit professional fails to commit to the ethical and transparent credit appraisal process, chances are that the credit transaction in question may go bad, and such a credit professional might be in dilemma of turning that account around, which means that bad debt would occur.”
“This means that the end testifies to the beginning.
“NICA is holding credit professionals to that commitment. To this end, when credit appraisal is being carried out, appropriate credit and business information must be gathered to build mitigation bridges against defaults, he added.
Onalo said that the bigger the information you get on the credit customer, the more likelihood you have on the success of that account, except other things happen which are beyond the control of both the credit customer, the credit provider organisation, or the credit professional.
He said that a credit professional must be well-grounded in the art and science of credit administration/management and must also be a member of a relevant and credible professional body, such as the National Institute of Credit Administration (NICA).
Besides, he said that he or she must ensure regular participation in capacity development by constantly attending training and retraining programmes relating to credit management.
