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NIRSAL MFB to offer loans to SMEs at 5% interest rate

NIRSAL Microfinance Bank would provide loans to small businesses at a single digit interest rate of five per cent, according to CBN Governor.

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Breaking News, Godwin Emefiele, Senate confirms Emefiele's re-appointment for second term

Governor of the Central Bank of Nigeria, Mr Godwin Emefiele, said NIRSAL Microfinance Bank will start offering loans to small businesses at a single digit interest rate of five per cent.

Mr Emefiele made the disclosure, Wednesday, during an inspection tour of the bank’s facilities located in Gwagwalada, Abuja. According to him, the newly-established MFB has been mandated to do everything possible to empower small businesses across Nigeria.

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According to him, NIRSAL Microfinance Bank’s target is to have a total of 774 branches across the local governemnt areas in the country. So far, only five branches have been established, even as fifty new branches are being planned for the next phase.

Other pilot phases for NIRSAL Microfinance Bank are: Ibadan, Bauchi, Kaduna, Enugu, Lokoja, and Port Harcourt, Mr Emefiele said.

Speaking further, Mr Emefiele said that the new microfinance bank, which has N5 billion worth of capital base, is expected to help the CBN actualise its 80% financial inclusion target by 2020.

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As we reported, the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) unveiled the new national Microfinance Bank (MFB) earlier this year, with the intention to catering to over 400,000 Small and Medium Enterprises (SMEs) within its first two years. It is wholly-owned by the Central Bank of Nigeria.

Mr Emefiele said the loan scheme would be financed with money from the Agribuisness/Small and Medium Enterprises Investment fund. The repayment period for every loan is five years. There will be a two year moratorium.

“The biggest problem that small businesses always have is access to credit and I am happy that with the establishment of this microfinance bank, which will be in at least one local government and we are talking about the 774 locations across the country.

“We will be able to have a financial institution that will help to deepen financial inclusion to make it easy for people to access credit, particularly the small and unbanked people, because we have always said that these are the very weak.

“We will use this to improve access to credit. Interest rate for this will be at five per cent and the loan will be for a tenure of seven years with two years moratorium.”

No Collateral issue

Meanwhile, bearing in mind that some businessmen have issues with collaterals, Mr Emefiele said that NIRSAL would give out loans without using the conventional collateral requirements.

He said “We know that those who are weak in terms of those who are unable to access credit, the big issue for them is their inability to provide collateral.”

Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: fakoyejo.olalekan@nairametrics.com.

26 Comments

26 Comments

  1. Affiong Hogan Asuquo

    October 3, 2019 at 11:11 am

    I have sign in n apply for the load but can not summit it since yesterday wat is d problem

  2. EME KALU Obinna

    October 28, 2019 at 12:57 pm

    I need a loan how do go about it am in ph

    • Chima kalu

      April 16, 2020 at 8:10 pm

      Am Chima kalu( aka) Chimex Enterprises, how do I reach your office in Owerri?

  3. Erimi Precious

    November 10, 2019 at 11:24 pm

    Please how can I apply?

  4. Jimoh Rafiu Alabi

    December 14, 2019 at 9:16 pm

    Comment:I try to register since 3 days ago it tells that I have already registered with you,which is not. What’s happening

  5. Shobayo Saheed Adeshola

    January 5, 2020 at 5:11 pm

    Comment:
    Pls how do I apply for this loan?

  6. ekehmagnus

    January 9, 2020 at 8:57 pm

    how will I apply for time
    his loan

  7. Otoede Monday john

    January 13, 2020 at 2:21 pm

    I have applied for the loan last week, for my agric business (feedsmilling, poultry) for 10,000,000 ten million.

    • Raduno Africa limited

      April 20, 2020 at 1:19 pm

      Please how can one apply for the loan. There is form and address. Thanks

  8. Alamin

    January 21, 2020 at 9:32 pm

    We need help for this bank,

  9. AUTA FELIX IGNATIUS

    February 3, 2020 at 8:58 am

    I will like to apply for a loan of 10,000,000 Naira only for an Agriculture ( Animal Farming)

  10. Muhammad Auwal

    February 4, 2020 at 4:53 pm

    I am very interested in the loan isuence in other to earn a living as a graduate.

  11. Muhammad Auwal

    February 4, 2020 at 4:55 pm

    This opportunity will make the youth to be self reliance in other to earn a living thank you.

  12. abdullahi

    February 16, 2020 at 11:53 pm

    Comment:how do I apply the loan

  13. Moses Okonji

    February 21, 2020 at 6:48 am

    My is Moses Okonji, Please how do I apply for the loan I have registered my details but don’t have access to the loan applications form. Thanks

  14. Anonymous

    February 24, 2020 at 3:50 am

    The only problem that may hinder me from applying is issue of interest attached which is prohibited in islam

  15. Anonymous

    February 24, 2020 at 3:52 am

    The interest charge is the main problem

  16. Gud Yohanna Pwajok

    March 27, 2020 at 7:38 am

    I’am interested in the loan ,how can I access it.lam a farmer.

    • Adedotun Odusina

      April 27, 2020 at 7:37 am

      I need loan for my poltry farm, yam and pepper farm in Ogun state. How do I go about aquiring the loan to boost it?

  17. George George Ekpo

    March 28, 2020 at 1:12 am

    please how do i gain access to this loan .

  18. Kabir Hassan

    April 1, 2020 at 7:19 pm

    How do i apply for the loan?

  19. Assets Height International

    April 11, 2020 at 12:01 am

    I need directions to have my company register

  20. Onyeka onah

    April 14, 2020 at 10:27 am

    How one apply

  21. Kenneth Bawa

    April 19, 2020 at 4:41 pm

    Please how do I apply for this loan?

  22. Tijjani kabir

    May 8, 2020 at 3:02 pm

    Mr.fakoyejo olalaken my name is Tijjani KABIR from kano state I applied for agsmeis loan I did everythings that was required I was interviewed on 12/2/2020 iam waiting for an offer to sign coincidentally and unfortunate cases of corona virus interrupted and now we were lockdown at home we don’t know what to do yet,but iam curious to know what is happening right now,pls inform everything’s you know about it.thank you.

  23. Abbas Ibrahim

    May 26, 2020 at 12:21 pm

    My name is Abbas Ibrahim.I operate business (SME) i’m a trader ie i buy and sell but this days i hardly corpe due to short of financial constrain.please i need financial support for me to be able survive in my business operation and in life in general. I’m Diploma holder from Nassarawa Federal polytechnic. Need to hear from you soon

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Business News

Why households that engage in subsistence agriculture are poor – Yemi Kale

“We established the poverty line at N137,430 and any individual or family that spends below this on food in a year will be classified below the poverty line.”

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Rauf Aregbesola annual colloquium

Subsistence agriculture alone may never be able to sustain any household in Nigeria. This is according to Nigeria’s Statistician-General and CEO of the National Bureau of Statistics (NBS), Dr Yemi Kale, who spoke during the Rauf Aregbesola annual colloquium earlier today. The event had the theme Government Unusual: Innovative Economic Solutions to Unlock Mass Prosperity.

Using insights from the 2019 National Living Standards Survey, Dr Kale explained that households that are solely engaged in subsistence agriculture appear to have the highest levels of poverty. This set of families are followed by households with more than twenty members.

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“This doesn’t mean agriculture is a bad thing. It simply means the way we do agriculture in Nigeria has to be improved so that it does not become synonymous with poverty or we have to find other sources of income for farmers to supplement their standard of living,” he said.

Speaking further, Dr Kale explained that the living standards survey, which was conducted in collaboration with the World Bank, started in late 2018 and ended in 2019. The survey utilized data from all states in Nigeria except Borno whose data was not considered credible enough given the security situation in the state. Kale said:

“We established the poverty line at N137,430 and any individual or family that spends below this on food in a year will be classified below the poverty line.”

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Given this yardstick, the survey established that at least 22.9 million Nigerians are living in poverty, with the bulk of this number coming from the rural areas and states with low indices on education, social welfare initiatives, employment, and income equality.

Formalising the informal sector

The informal sector comprises people who earn enough to keep above the poverty line on a daily basis, but not enough to sustain them in the event of a lockdown, as was seen recently in some states during the April COVID-19 lockdown. This is a problem that can only be solved if the informal sector becomes formalised, Kale said. In other words, formalizing this sector will help more daily wage earners stay above the poverty line. He made reference to the recent lockdown which incapacitated lots of daily wage earners in states such as Lagos.

Nigeria’s poor versus other African countries

Making a comparison, Yale also noted that Nigeria’s poor are poorer than their counterparts in South Africa despite the fact that the nominal size of Nigeria’s economy is much larger.

He attributed this to findings which showed that Nigerians spend three times more on foods and consumables than all other items put together, as against countries like South Africa and Egypt where less is spent on food items.

“Nigerian remains Africa’s largest economy, but per capita income is rather low for a country of this size, and the level of poverty presents a major development challenge” he noted.

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Reducing unemployment – the fastest way out

According to Kale, the fastest way out of poverty is to reduce unemployment, as people will naturally have more to spend on their needs when they are employed. To support his point, Kalu cited five Nigerian states with the least poor people in comparison to the other states Lagos, Delta, Ogun, Osun, and Oyo. Each of these states has fewer unemployment levels compared to the states with higher poverty rates such as Sokoto, Taraba, Jigawa, Ebonyi, and Adamawa states.

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Other indicators which show similar trends across the states are education, and ease of doing business. The poverty rates are almost always higher where education is poor.

Increasing local production

Also making a presentation during the colloquium, Dr Joe Abah called for a review of the 1978 land use act which he said is limiting in its provisions. He also stressed that Nigeria needs to improve access to capital, raw materials, lands, and technological innovations so that production capacity can increase significantly.

“All of the richer countries simply produce more, and they produce more things that people want to buy and want to consume. It could be products or services. the higher your production capacity, the richer you are. if you cannot produce, you cannot develop your education or your health sector.”

According to Abah, the cost of governance cannot be reduced without adopting some of the suggestions of the Oronsaye report, and restructuring the system for productivity. He said that “there is also a need to link budget and funding to productivity so that public sectors begin to understand that the more funding they require, the more they are expected to produce as well.”

He also suggested that states should start focusing on their competitive advantage and use same to improve general productivity in their state.

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Other panelists at the colloquium include Mallam Nasir El-Rufai, Governor, Kaduna State, Sen. Abubakar Bagudu, Governor, Kebbi State, Mrs. Hajara Adeola, CEO, Lotus Capital Limited, Mr. Bismarck Rewane, CEO, Financial Derivatives Limited, Dr. Joe Abah, Country Director, DAI, Dr. Yemi Cardoso, Chairman, Citibank Nigeria, with Boason Omofaye as the moderator.

You may watch the colloquium by clicking here.

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Economy & Politics

Output cut: Nigeria leads in OPEC non-compliance with 50 unsold cargoes of crude

Nigeria and Iraq were reported not to have kept to their commitment to the huge production cut deal that had promised to reduce output by 9.7 million barrels of crude oil per day.

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Petroleum Industry Bill to be passed by mid-2020, says Sylva, FG discovers crude oil in north, says there’s more , OPEC, non-OPEC countries to meet as Saudi, Russia price war affects Nigeria’s budget, FG considers fuel price reduction, OPEC deal: Nigeria to generate additional $2.8 billion revenue as FG reacts

As opinions continue to differ on whether OPEC will extend its current oil output cut beyond June, available information has shown that not all members of the oil cartel complied fully with their agreed quotas for the month of May. This is despite the fact that the oil output by OPEC member countries reached its lowest in almost 20 years.

Available data from oilprice.com showed that OPEC members cut their output by 5.91 million barrels per day from the April level, producing 24.77 million barrels per day. This figure also showed a 4.48 million barrel per day of the agreed output cut, thereby representing a 74% compliance level.

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Nigeria and Iraq were reported not to have kept to their commitment to the huge production cut deal that had promised to reduce output by 9.7 million barrels of crude oil per day.

Iraq was able to achieve just 38% compliance of its agreed output cut for the month of May, while Nigeria, which achieved a much lower compliance of the agreed output cut, recorded 19% compliance of what was agreed. Saudi Arabia showed the highest compliance, recording 96% of the agreed output cut.

Some have attributed the noncompliance of some members of OPEC to the agreed output cut, to the contractual obligations and commitment to buyers, given the short timeframe between when the agreement for the output cut was made and its implementation.

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Meanwhile oil exports from Angola and Congo remained steady at high prices on Friday, while Nigerian oil fared lower amid huge inventory of unsold cargoes.

Nigeria continues to face some difficulty in the oil market, primarily due to sluggish demand from Europe; it has around 50 unsold cargoes of crude oil yet to be sold for the months of June and July.

Meanwhile, India has become one of the few buyers for the Nigerian oil. Indian oil firms bought about 5-6 million barrels of Nigerian crude oil last week and has bought about 2 million barrels as at Thursday this week.

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Business News

President Muhammadu Buhari reshuffles NNPC’s board of directors

Note that the former board included the late Chief of Staff to the President, Abba Kyari as a member. Stakeholders have since expected the President to reconstitute a new board to take over.

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President Muhammadu Buhari to address Nigerians on Monday, receives update and recommendations from PTF

President Muhammadu Buhari has approved the reconstitution of the board of the Nigerian National Petroleum Corporation (NNPC) after the expiration of the tenure of the current board.

The newly constituted board members are expected to serve for a tenure of three years, effective immediately. They will take over from the last board, whose 3-year tenure officially ended in 2019. Information about this development is contained in a State House press release that was published on the official twitter handle of the Nigerian Presidency on Saturday morning.

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READ MORE: Construction of ICT Parks nudges Nigeria into digital transformation

READ ALSO: CBN and NIPOST open pilot microfinance branches

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The newly constituted NNPC board is made up of six members from each of the geo-political zones in the country. The members include the following individuals:

  • Mallam Mohammed Lawal, representing the North West
  • Dr Tajudeen Umar from North East
  • Adamu Mahmood  Attah from North Central
  • Senator Magnus Abe from the South-South
  • Dr Stephen Dike from the South East, and
  • Chief Pius Akinyelure from the South West geo-political

READ MORE: Boko Haram: A protracted battle yet to be won?  

Of the six members, three are returning members on the board – Chief Pius Akinyelure, Mallam Mohammed Lawal, and Dr Tajudeen Umar from North East.

Note that the constitution of the new board is considered a welcome development, as it balances the representation of the six geo-political zones on the board. The previous constitution of the board was faulted for not being “balanced”.

READ ALSO: Full text of President Muhammadu Buhari’s 58th Independence day broadcast

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Note that the former board included the late Chief of Staff to the President, Abba Kyari as a member. Stakeholders have since expected the President to reconstitute a new board to take over.

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