CBN and NIPOST open pilot microfinance branches

The Central Bank of Nigeria (CBN), and the Nigerian Postal Service (NIPOST), have started making plans to build a National micro-finance bank with pilot projects in six Geo-political zones and the Federal Capital Territory (FCT), Abuja.

The Governor of CBN, Mr. Godwin Emefiele, disclosed this on Wednesday at Gwagwalada, Abuja while on a facility tour of Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) MfB, an agribusiness initiative which provides risk for framers.

The various locations are Ibadan, Port Harcourt, Bauchi, Kaduna, Enugu and Lokoja and Gwagwalada in Abuja.

According to Emefiele,

“We are just inspecting one out of the first seven and we are scaling up to the next 50 in the next phase. We believe that before the end of this year, we would have moved substantially in making sure that they are set up and be able to provide finance to small businesses. This is collaboration between NIRSAL, bankers Committee and NIPOST and I want to say that we really need to set up Microfinance Bank that will reach out to the unbanked.”

The project is long overdue seeing the announcement about the establishment of the micro-finance banks was made last year. Although, last month, there was a minor set-back on the plans of its establishment.

About the project

The project which is been handled by the CBN, the Bankers’ Committee and NIPOST, entails the building of Micro-finance Bank branches in all the 774 local governments of the country.

The Bankers Committee, NIRSAL and NIPOST are to see to the establishment of the first seven MfBs in the six Geo-political zones and the Federal Capital Territory (FCT).

Thereafter, the number will be scaled up to 50 MfBs, and it will proceed that way until it is rotated in all LGA’ s of the country.

Reason for the project

Emefiele explained that the Micro-finance bank would help tackle the lack of access to cheap finance by small businesses.

He said with its presence in all 774 local governments of the country, Nigeria would have a financial institution that will help deepen financial inclusion to make it easy for people to access credit particularly the small and unbanked people because the economy have termed these people as the very weak.