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Disbursement of N220bn MSME fund begins August

By on July 25, 2014

Barring any last minute change, the Central Bank of Nigeria will from next month commence the disbursement of its N220bn Micro, Small and Medium Enterprises intervention fund.

The Governor of the apex bank, Mr. Godwin Emefiele, disclosed this on Thursday in Abuja during the signing of a Memorandum of Understanding between the bank and governors from 11 states.

The MoU, signed atnthe apex bank’s headquarters had in attendance governors from Delta, Akwa Ibom, Osun, Oyo, Bayelsa, Gombe, Zamfara, Enugu, Ondo and Benue states.

The CBN governor said the flag off of the disbursement would be done by President Goodluck Jonathan, noting that the fund would be given to Nigerians at a single digit interest rate of nine per cent.

Emefiele said that based on the guidelines of the fund, each state of the federation would be able to access the sum of N2bn which would be administered through Micro Finance Banks.

The governor, who put the funding gap of the sector at about N9.6tn as at 2010 said, “As a country, we don’t have a choice than to support the youth by taking actions to engage their energy positively by creating jobs for them.

“We would work with you to ensure that it gets to the beneficiaries directly at a maximum rate of nine per cent, 60 per cent of this money will go to women

“The disbursement of the loan will kickoff in August and we want the President to personally kickstart the process in August.”

He said the CBN fund would focus on resolving challenges such as access to collateral and enterprise development support.

The governor said since the country has a large proportion of youths, there is an urgent need to engage their energy positively in productive sectors that would create jobs and reduce poverty.

This, he added, underscored the need for the apex bank, in pursuit of its developmental mandate to release the fund at a single digit interest rate for the development MSMEs.

Emefiele said as part of measures aimed at ensuring inclusive growth for the economy, 60 per cent representing N132bn out of the fund had been set aside for women.

He said, “We are starting with N220bn and I can assure you that once this amount is fully applied we would seize opportunity to increase it.

“But the important thing is that we are saying that the fund is going to be applied towards supporting the financing needs of our people a the lowest level of the pyramid at dingle it rate.

“We believe that if properly applied, what you will find is that it would see to the transformation and economic development of Nigeria and that is what is uppermost in our minds so even if we have to do more after this, it would be worth it.”

He assured that all the bottlenecks that may affect the implementation of the program would be addressed by the apex bank.

The Governor of Akwa Ibom State, Mr Godswill Akpabio, commended the governor for the initiative, noting that a lot of lives would be transformed with the intervention fund.

He, however, said since the sector has the potential to create jobs, there is need for the bank to increase the accessible amount by each state from the current N2bn to between N3.5bn and N4bn.

He also requested that all bottlenecks that would hinder the successful disbursement of the fund be removed so that those who should benefit for the fund should not be excluded.

He said, “There is need to increase the amount because Nigerians are in a hurry owing to see a reduction in poverty and unemployment rate.

“We can start with N3.5bn or N4bn for each state so that we can make great impact with the sector in creating jobs

“We should also remove some of the impediments that will affect the disbursement of this fund.

The state can even guarantee this money so that it can quickly get to the beneficiaries. The experience in the past is that many intervention funds are not easily accessed owing to bureaucratic bottlenecks and this need to be addressed.”

 

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