Business News
Nigeria approaches World Bank for another $2.5 billion loan
Nigeria’s debt profile is set to hit another height as the World Bank confirmed that it is in talks with the Nigerian government to offer another loan to the tune of $2.5 or N767.3 billion
Nigeria has reportedly approached the World Bank for another loan to the tune of $2.5 or N767.3 billion in a new tranche of concessionary lending.
According to Bloomberg, the World Bank’s vice president for Africa, Hafez Ghanem disclosed this in Abuja on Wednesday night.
Ghanem stated in an interview that in the past year, Nigeria received $2.4 billion from the World Bank, while he stated that Nigeria and the world bank are in talks over a new $2.5 billion loan. “We’re talking about a new set of programs of about the same amount, it should be around $2.5 billion,” he said.
[READ: Nigeria spends N1.11 trillion to service debt in half-year 2019]
Further Details: According to Ghanem, it’s important to resolve the problems of the power sector in Nigeria to bring in more investments. He further disclosed that the World Bank is supporting digital transformation in Nigeria because of its potential ability to transform other areas of the economy including industry, agriculture and services,
“Nigeria has a comparative advantage in that area because of the youth, a majority of the population is young,” he said. “So if we want to create jobs, we need to invest much more in the digital economy.”
“Because you need to bring down the cost of power to make the economy more competitive for the development of industries.” Ghanem Stated.
To ease the mounting debt burden, Nigeria has sought more credit with low interest and long repayment periods from institutions including the World Bank and the African Development Bank.
Brief on Nigeria’s debt profile: Data obtained from Nigeria’s Debt Management Office (DMO) as at the end of March 2019 shows that the country’s public debt (domestic and external) stood at a whopping N24.9 trillion. This is about 19% of the country’s Gross Domestic Product.
- Nigeria’s rising debt has attracted wide criticisms both locally and internationally. For example, the International Monetary Fund (IMF) questioned Nigeria’s ability to repay its N24.9 trillion debt.
- Nigeria is largely faced with revenue shortfalls as the output and price of oil, fell in the past five years.
- The IMF had also expressed concern about the rollover risks, arguing Nigeria’s capacity to refinance debt might drop in the future.
- Meanwhile, the Federal Government has since rebuffed such claims, stating that the nation’s debt burden is sustainable.
- The Federal government also disclosed this week that Nigeria spent a whooping N1.11 trillion to cover debt service obligations in the first six months of the year 2019.
- More debt on the horizon as the Minister of Finance, Budget and National Planning, Mrs. Zainab Shamsuna Ahmed, disclosed that the sum of N1.7 trillion will be borrowed to finance the 2020 budget.
[READ FURTHER: FG to borrow N1.7 trillion to finance 2020 budget – Finance Minister]
Business News
CAC sets 3-hour time line for company registration in 2021
The CAC is prioritising the reduction of the registration circle for new companies to just 3 hours before the end of the year 2021.
The Corporate Affairs Commission (CAC) has said that following the successful deployment of an end-to-end registration module, it was now prioritising the reduction of the registration circle for new companies to just 3 hours before the end of the year 2021.
This is coming after CAC had in November 2020, announced the implementation of new technology that will change the face of business registration including allowing customers to print their certificates with verifiable QR code from anywhere in the world.
This disclosure was made by the Registrar-General of the commission, Garba Abubakar, at a dinner in honour of the Chairman, Governing Board, CAC and Nigerian Ambassador-Designate to the Kingdom of Spain, Ademola Seriki.
In order to achieve this target, the Registrar-General said the commission was making arrangements to empower over 400 approving officers with working tools to process and approve registration applications either from home or anywhere necessary,” the agency stated.
Abubakar noted that the challenges of the Covid-19 pandemic had adversely hampered CAC’s delivery timeline.
He, however, pointed out that CAC was resolutely committed to serving its customers despite being forced to operate with less than 50% of its workforce.
While bidding farewell to Seriki, the Registrar-General said he received the news of his appointment with mixed feelings as CAC was going to miss his tremendous support and guidance.
Also speaking at the event, the Minister of Industry, Trade and Investment, Niyi Adebayo, described the outgoing CAC Chairman as a man of immense pedigree and endowed with enormous potential to justify the confidence reposed in him by the president.
In case you missed it
- The CAC recently announced the upgrade of its website and online registration portal to include features, which allow for the automation of some selected services and processes, in line with the Federal Government’s mandate of improving the ease of doing business in Nigeria.
- The selected services and processes include Electronic search of company records, Upgraded Companies Registration Portal for Pre-incorporation filings and Post incorporation filings.
The Corporate Affairs Commission (CAC) says following the successful deployment of an end-to-end registration module, it is now prioritizing the reduction of the registration circle for new companies to just 3 hours before the end of year 2021. pic.twitter.com/mMGjLN1JeS
— Corporate Affairs Commission (@cacnigeria1) April 11, 2021
Corporate deals
DEAL: Nigerian fintech software provider, Appzone raises $10m to scale its products and services
Appzone platforms are used by 18 commercial banks and over 450 microfinance banks in Africa.
Appzone a fintech software provider that builds proprietary solutions for financial institutions and their banking and payments services announced that it has closed $10 million in Series A investment.
The Series A round was led by CardinalStone Capital Advisers, a Lagos-based investment firm. Other investors include V8 Capital, Constant Capital, and Itanna Capital Ventures. New York-based but Africa-focused firm Lateral Investment Partners also participated.
Founded in 2008 by Emeka Emetarom, Obi Emetarom, and Wale Onawunmi, Appzone functions as an enabler (at payment rails and the core infrastructure) within banking and payments.
READ: Shola Akinlade: The inspiration behind Paystack’s success
Appzone platforms are used by 18 commercial banks and over 450 microfinance banks in Africa. Together, they amass a yearly transaction value and yearly loan disbursement of $2 billion and $300million.
Before now, Appzone closed a $2 million deal from South African Business Connexion (BCX) in 2014. Four years later, it raised $2.5 million in convertible debt and bought back shares from BCX in the process. But overall, the company says it has raised $15 million in equity funding.
This new funding will be used to scale its products and services and expand across more African countries. The startup also plans to achieve scale by growing its engineering team.
READ: From Chemist to Bank CEO – The Story of Uzoma Dozie
What they are saying
Yomi Jemibewon, the Co-Founder and Managing Director of Cardinal Stone Capital Advisers, said the firm’s investment in Appzone is further proof of Africa’s potential as the future hub of world-class technology.
READ: Bill Gates holds far more cash than Nigeria’s foreign reserve
“Appzone is building a disruptive fintech ecosystem that will be the backbone of Africa’s finance industry with products across payments, infrastructure, and software as a service. The impact of Appzone’s work is multifold — the company’s products deepen financial inclusion across the continent whilst providing best-fit and low-cost solutions to financial institutions. Its emphasis on premium talent also helps stem brain drain, rewarding Africa’s best brains with best-in-class employment opportunities.”
