Jonathan FG to Expand Support for MSME Sector
IMAGE: President Goodluck Jonathan »
President Goodluck Jonathan yesterday commenced the official disbursement of Central Bank of Nigeria (CBN)’s N220 billion fund for Micro Small and Medium Enterprises (MSMEs) to state governments and financial institutions which have met set criteria, promising that his administration would increase its focus on the sub sector to make it more vibrant.
Describing the MSME sector as the engine of economic growth and job creation, he said government would work tirelessly to frontally address the challenges in that sector by improving access to finance and investing heavily in infrastructure to drive down the cost of doing business as well as enhance the competitiveness of entrepreneurs.
Commending the CBN Governor, Mr. Godwin Emefiele, for bringing the monetary intervention to fruition, Jonathan expressed confidence that the disbursements would help to structurally transform the economy and significantly boost MSMEs contribution to the Gross Domestic Product (GDP).
Speaking at the end of the 8th MSME finance conference in Abuja, the president said he was particularly delighted that about 60 per cent of the fund had been set aside to support women entrepreneurs who he described as critical for economic transformation.
He added that empowering the sector had become an enormous task which must be matched with concrete actions stressing that some of government’s recent initiatives for small entrepreneurs had already yielded positive result as evident with the YouWin programme.
Among other efforts, Jonathan said his administration was working to further cut the food import bill and particularly reduce rice import, adding that the new automotive policy had started recording success with the recent production of locally assembled vehicles by Nissan.
It came on a day the CBN governor also disclosed that the bank was working with relevant stakeholders in the financial system to establish a secured transaction and National Collateral Registry to facilitate the registration and acceptability of moveable property as loan collateral in a bid to further ease to finance for small businesses.
He noted that the fund had been initiated as an innovative way of improving MSMEs access to finance and shoring up their potentials to create jobs and reduce poverty.
The CBN boss said the fund was a direct statement on his resolve to create a professional and people-centered central bank which would act as catalyst for job creation and inclusive economic growth.
He said participating deposit money banks had been mandated to obtain biometric information of borrowers through a data base already created by the CBN to ensure that funds get to genuine borrowers as well as discourage multiple access.
He stressed that the apex bank would set up strict monitoring facility to ensure that the money not only get to targets but are also used for viable growth.
Meanwhile, qualified individuals would be able to access between N50,000 and N100,000 while state governments are entitled to apply for N2 billion.
He added that two per cent of the fund would be set aside for economically active but physically challenged persons.
Intended beneficiaries are also mandated to join a cooperative society to facilitate their chances.
Emefiele also noted that about N237 billion had so far been disbursed to 313 projects under the Commercial Agriculture Credit Scheme (CACS) as at July 2014.
Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, described the CBN intervention as a big step in the development of the MSME sector.
He lamented that though SMEs sector accounted for about half of GDP, only 80 per cent of small businesses had access to formal financing.
He also disclosed a National MSME Council would soon be inaugurated by President Jonathan to bring everyone under one roof in a bid to address the needs of the sector.
Aganga further urged beneficiaries of the fund to ensure proper utilisation.
Article Credit: Thisdaylive