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Why N220bn MSME fund release is delayed – CBN

By on April 16, 2014

The Director, Development Finance Department, Central Bank of Nigeria, Mrs. Louise Chuma, has said the delay in the disbursement of the N220bn intervention funds for Micro, Small and Medium Enterprises in the country is as a result of the plan to establish a Special Purpose Vehicle to handle it.

Usually, a SPV is a subsidiary company with an asset/liability structure and legal status that makes its obligation secure even if the parent company goes bankrupt.

Chuma explained that after experimenting with the project, a platform was provided for other stakeholders to deliver their inputs, and the guidelines to access the funds were prepared, and that presently, sensitisation programmes were being held to create awareness.

She said, “The reason for the delay in the release of the funds is because so many things have to be put in place; the commercial market aspect is there, which is 90 per cent; the grant component and the social component are also there.

“The secretariat, I am glad to announce to you, has been setup in the Development Finance Department of the CBN. The special purpose vehicle is about to be setup because the state governments have also been allowed to have a separate N280bn and also allowed to setup special purpose vehicles.”

According to her, 80 per cent of the N220bn MSME intervention funds is earmarked for enterprises set up and being run by women, adding that individuals cannot apply but the participating financial institutions, including microfinance banks and cooperative societies, can apply for the funds.

She assured that the CBN was determined to see the project come to fruition, although this might not be as fast as private sector-driven projects.

 

 

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