The Central Bank of Nigeria (CBN) has approved the request by Deposit Money Banks (DMBs) to provide financial accommodation to State Governments to enable them pay the backlog of salaries of their workers.
This came following the decision by the National Executive Council (NEC) at its meeting of 29th June, 2015 requesting the CBN, in collaboration with other stakeholders to appraise and consider ways of liquidating the outstanding staff salaries owed by State and local Governments.
The conditions for accessing the loan facility include resolutions of the State Executive Council authorizing the borrowing and State House of Assembly consenting to the loan package, as well as issuance of Irrevocable Standing Payment Order (ISPO) to ensure timely repayment.
Meanwhile Kwara and Zamfara States are the first to enjoy CBN’s N300 billion intervention fund targeted at helping the states pay backlog of salaries owed to workers.
According to the CBN, out of the 27 states that applied for the fund, only the two states have so far qualified.