Nigeria’s apex bank, Central Bank of Nigeria (CBN) has so far distributed N49 billion out of its N50 billion Targeted Credit Facility to 80,000 persons in a bid to support their businesses in the face of the novel coronavirus.
The apex bank’s Business Expectations Survey Report for June 2020 shows that at -24.3 index points, the overall confidence index (CI) indicated respondents’ pessimism on the overall macro economy in June while the respondents are optimistic in their outlook for July.
CBN’s Director, Corporate Communications, Mr. Isaac Okorafor, disclosed that about 80,000 operators of micro, small and medium scale enterprises (MSMEs) and families have benefitted from the intervention fund.
He said the fund was expected to support the federal government’s measures to stimulate economic activities as well as to help the economy avert a looming economic recession with the outbreak of COVID-19 and consequent lockdown.
“So far, out of the N50 billion targeted credit facility for households and small businesses, we have disbursed about N49 billion. We also have other intervention funds such as the N100 billion healthcare facility, whose disbursement is ongoing as well,” he added.
The apex bank had earlier released guidelines for the disbursement of the special intervention fund.
The NISRAL Microfinance Bank (NMFB) served as the disbursing financial institution and the fund is meant for SMEs, households and enterprises that have verifiable evidence of livelihood and evidence of business activities adversely impacted by the pandemic.
The guidelines for the fund had listed sectors eligible for the credit facility to include agric value chain, hospitality, health, airline service providers, manufacturing/value addition, trading as well as any other income-generating activities as may be prescribed by the CBN.
The scheme is being financed out of the CBN’s N220 billion Micro, Small and Medium Enterprises Development Fund (MSMEDF).
Out of the fund, the CBN had earmarked a maximum facility of up to N25 million for MSMEs while households can access up to N3 million based on the activity, cashflow and industry/segment size of a beneficiary.
“Working capital shall be a maximum of 25 per cent of the average of the previous three years’ annual turnover; where the enterprise is not up to three years in operation, 25 per cent of the previous year’s turnover will suffice.
“Interest rate under the intervention shall be five per cent per annum all-inclusive up to 28th February 2021 and thereafter, the interest on the facility shall revert to nine per cent as from 1st March 2021,” part of guidelines for accessing the fund had stated.