# Implementing GSI with Direct Debit

GSI (Global Standing Instruction) was created by the Central Bank of Nigeria (CBN) as a last resort for banks and financial institutions to recover outstanding loans from chronic debtors. It allows the creditor bank (the bank that gave the loan) to recover their debt from any or all other accounts held by the borrower with other financial institutions in the case of default.

## Objectives of GSI:

* Facilitate an improved credit repayment culture.
* Reduce Non-Performing Loans (NPLs) in the banking industry.
* Watch-list consistent loan defaulters.

## How this works:

**Borrower Authorization**: The borrower authorizes the lender to recover outstanding debts automatically from their bank accounts across different financial institutions.

**Linking Accounts**: The borrower must link all qualifying bank accounts to their Bank Verification Number (BVN).

**Triggering GSI**: In case of default, the creditor bank triggers the GSI, which initiates a balance enquiry and issues debit instructions to other financial institutions holding the borrower's accounts.

**Executing Debit**: The Nigeria Inter-Bank Settlement System (NIBSS) facilitates the transfer of funds from the borrower's accounts in other banks to the creditor bank.<br>

This use of GSI helps lenders recover outstanding debts from your customers who have funds in other bank accounts, ensuring efficient debt recovery and reducing defaults.


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