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Manufacturers raise concern over charges on BoI loans

By on July 29, 2013

Manufacturers Association of Nigeria, MAN Ikeja branch, has expressed concern over numerous charges their members are made to pay to secure the Bank of Industry, BoI, loans, calling for immediate review and possible reduction.

Expressing this position at a business luncheon for chief executives and managing directors of manufacturing companies under the chapter, the chairman, Rev. Isaac Ade Agoye, said the problem has the capacity of inhibiting their collective growth as manufacturers, as well as hamper the survival of the real sector if unattended.

He noted that in all, manufacturers pay as much as 21.125 percent interest on BoI’s loans, saying, ‘We consider these surcharges as too cumbersome and demanding, hence we invited the BoI management for enlightenment.”

“We believe that if manufacturing is made easy and less cumbersome by way of accessibility of loans, manufacturers will obviously be encouraged and this could act as a stop-gap measure for militating the high rate of unemployment. We have the capacity to do so, all we need is encouragement,” Agoye added.

Going forward, he said that the association would form a working committee that would collaborate with the management of BoI to fathom ways of either eliminating or reducing those surcharges to the barest minimum.

He implored the management of BoI to look at the various surcharges with a view of doing away with some of them that are inimical and irrelevant to the exercise of lending, adding that, ‘a situation where charges on loans amount to 21.215 percent and above is certainly worrisome.

Speaking on the theme of the programme, “Bridging the Gap between Manufacturing and the Bank of Industry”, the Managing Director, BoI, Ms Evelyn Oputu, represented by Mohammed Alkali, ED, Operations, said that interest charges on loans do not constitute as much problem as infrastructural problem, generating own power and lack of incentives.

She assured that as part of incentivising the real sector, the BoI is engaging in continuous advocacy with all stakeholders towards improving the operational environment, adding that the bank leverages international resources for the development of the real sector in the country through collaboration with UNIDO, UNDP and AGOA among others.