(L-R) Mr. Cliff Emenike, chairman, strategic committee, Niropham; Bayo Adegun, head, south operations, Standard Organisation of Nigeria (Son); Ade Popoola, president, Niropharm and Lewis Ekome, secretary, at Niropharm networking evening recently in Lagos, Nigeria.

As the seventh National Assembly kicks off, commercial banks in the country are laying siege on the newly-elected senators and members of the House of Representatives to cajole them into takingvarious kinds of loans to settle down in Abuja.
BusinessWorld can reveal that banks are dangling attractive conditions for the offer of the loans, which range from N200 million to N300 million, before the new members of the National Assembly(NASS), and they are of low interest rate. They are offering the lawmakers between 14 and 15 per cent as interest rates on the loan which will enable them to buy houses in upmarket areas in Abuja.
By obtaining what the banks call ‘Change of Status Loan’, the lawmakers would be compelled to open an account through which their salaries and allowances would now be paid, while the loan is deducted at source, according to agreed terms, a process which  experts say falls short of  the needed collateral.
Currently, each representative is entitled to quarterly allowances of N42 million, while each senator collects about N60 million. The allowances, BusinessWorld learnt, are to cover accommodation, vehicle loan, furniture, wardrobe, vehicle maintenance, entertainment, recess, constituency, personal assistant, domestic staff, utility, severance, newspaper, and house maintenance.
 The annual basic salary of a member of House of Representatives is N1,985,212.50; while each senator takes N2,026,400.00. Our investigations reveal that banks have been going to the venues of induction and orientation courses organised for both new and old members of the legislature to solicit for customers. Many of them were seen at the International Conference Centre, Abuja, where the Peoples Democratic Party (PDP) held retreat for its members recently.
Some of the incoming lawmakers are said to have agreed to go for the loans. A newly elected  member of House Representative who spoke to our reporter  under condition of anonymity, said   officials of  the banks in the country have been disturbing  him with a view to convincing  him to take N120 million housing loan.
Another side of the story is how to recover the loans as the banks are not insisting on collateral, a crucial element in lending agreement especially in banking transactions. The collateral serves as protection for a lender against a borrower’s default - that is, any borrower failing to pay the principal and interest under the terms of a loan obligation.
The Revenue Mobilisaion Allocation and Fiscal Commission (RMAFC) pays senators an annual basic salary of over N2 million per month with other allowances like accommodation 200 per cent of basic annual salary.