Union Bank of Nigeria and BFREE, a cutting-edge German-Nigerian FinTech firm, have solidified a memorandum of understanding (MOU) aimed at revitalizing distressed loan portfolios within Nigeria.
The MOU was formalized during the German-Nigerian Business Forum held in Berlin, Germany.
Under the terms of this collaboration, BFREE, in collaboration with its international financing partners, will explore the potential acquisition of distressed loan portfolios from Union Bank, with a potential investment cap of $40 million. This strategic initiative primarily targets refinancing non-performing loan portfolios, especially those experiencing repayment delays or already listed as write-offs.
Adapting proactively to the challenging economic landscape, Union Bank seeks innovative ways to navigate the ongoing economic pressures. Leveraging artificial intelligence (AI), BFREE offers an inventive solution through automated interactions with loan customers. This approach facilitates discussions and agreements on revised loan terms. Notably, this streamlined process allows for swift assessment of numerous loan agreements within shorter periods, ultimately leading to higher repayment rates and reduced instances of loan write-offs for Union Bank.
Expressing enthusiasm about this partnership, Joe Mbulu, Executive Director of Union Bank, emphasized, “We are thrilled about our strategic partnership with BFREE, reflecting Union Bank’s commitment to innovation and adaptability. This collaboration underscores our dedication to finding innovative solutions for the economic challenges faced by our customers. By harnessing BFREE’s advanced AI capabilities, we aim to optimize the efficiency of our loan portfolio management, ensuring flexibility for our customers amidst these challenging times. This partnership signifies Union Bank’s proactive approach in navigating the evolving financial landscape, reaffirming our commitment to providing sustainable financial solutions to individuals and businesses in Nigeria.”
Julian Flosbach, Chief Executive Officer of BFREE, expressed excitement, stating, “BFREE is delighted to announce our strategic partnership with Union Bank, symbolizing our joint commitment to innovation and resilience amid economic challenges. With a proven track record of successfully managing over 4 million distressed customers across Africa, BFREE brings extensive experience to the forefront. Our proprietary AI capabilities will significantly streamline Union Bank’s loan portfolio management, offering unparalleled flexibility to customers during these testing times. The commitment of our financing partners underscores their dedication to supporting Union Bank’s revitalization efforts.”
