News Column

FG Begins Disbursement of N220 Billion MSME Fund Next Week

August 12, 2014

Sola Alabadan

President Goodluck Jonathan will flag off the disbursement of the N220 billion Micro, Small and Medium Enterprises (MSMEs) Development Fund in Abuja on Tuesday August 19, 2014, the Central Bank of Nigeria (CBN) said.

The CBN informed that the president will do this during the 8th Annual MSMEs Finance Conference being organised by the apex bank from Monday, 18th to Tuesday, 19th August, in Abuja.

The statement by the Development Finance Department of the CBN added that President Jonathan will also award prizes to MSMEs, Deposit Money Banks and State Governments who distinguished themselves in Entrepreneurship Development in 2013.

Participants expected at the conference include Micro, Small and Medium Entrepreneurs, Banks, Microfinance Institutions (MFIs), Microfinance Banks (MFBs), deposit money banks, State Governors, Federal Ministers, Heads of Government Agencies and Departments, International Development Agencies and captains of industries.

As a means of strengthening the link between entrepreneurship and access to financial services, the CBN plans to disburse the N220 billion MSMEs fund at an interest rate of 9 per cent to MFBs who would in turn disburse same to the beneficiaries.

As the 60 per cent of the funds would be given to women, the CBN also announced an interest rebate component for women in the fund so that women who borrow from MFBs are able to access these funds for interest rate subsidy to make sure that they do not pay more than 9 per cent interest on their loans.

The apex bank further affirmed that it would not be lending directly to businesses, but that the loan would be disbursed through the MFBs.

During the signing of Memorandum of Understanding (MoU) with the 36 State governments on MSMEs Fund in Abuja recently, the CBN Governor, Godwin Emefiele, noted that the MSMEs have the potentials to boost production, create jobs, reduce poverty and ensure inclusive economic growth and development in the country if adequately funded.

In spite of global recognition, he lamented that MSMEs in Nigeria had not received adequate financing required to play their pivotal roles in national development.

He further said the state governments would be able to access up to N2 billion each for on-lending to eligible beneficiaries through participating financial institutions in their states.

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Source: AllAfrica

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