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Business News

CBN discloses conditions for assessing N100 billion credit facility, addresses ‘process problems’

The operations of this scheme have not been as smooth as expected, because some operators in the sector have been complaining about not having access to the funds.

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Banks' stakeholders express 4 main concerns bothering the sector right now, CBN, MARKET UPDATE: CBN’s historic agriculture lending; Is it yielding the desired results? 

As part of measures to mitigate the impacts of COVID-19 on businesses, particularly those in the health sector, the Central Bank of Nigeria (CBN) had introduced a N100 billion credit intervention scheme.

The scheme, which was planned to be funded from the Real Sector Support Facility – Differentiated Cash Reserves Requirement, is to have an interest rate of 5% per annum until March 1, 2021, when it will revert back to 9%.

However, the operations of this scheme have not been as smooth as expected, because some operators in the sector have been complaining about not having access to the funds.

In a recent TV interview, the CBN’s Director for Development Finance, Mr. Yusuf Yila, discussed some basic conditions that applicants to the CBN N100 billion credit facility must meet before they qualify to benefit from the facility. On the disbursement of the N100 billion facility, Yila said:

As at today, we have received applications in excess of N62 billion. These funds are to be disbursed by the banks. When these applications come on, as a Central bank what we are looking at is how many jobs take for example a pharmaceutical company can expand its line or build new capacity, how jobs are going to be created, how many of the raw materials are going to be sourced locally, how much foreign exchange is the country going to be conserving.

Those are the things we actually look for in these applications. We are not going to be doling out money for people who are going to be importing or going to source for foreign exchange for materials we can source locally. I can also tell you as at today the central bank has disbursed in excess of N11 billion out of N100 billion and this week we are taking to Governor Emefiele another set of applications in excess of N20 billion from 9 banks.”

(READ MORE:CBN health intervention fund gets new interest rate by March 2021)

The CBN Director also emphasised that there is a process involved in disbursing the loans and that the major idea is to conserve foreign exchange. He also explained that the pharmaceutical industry is worth over $1.3 billion and out of this, about $900 million is imported.

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COVID-19: NCDC equips testing centres in Ibadan, Abakaliki as figures continue to rise, CBN discloses conditions to assess N100b facility, identifies problems in processing facility

A medical professional using medical equipment

On the complaints by some applicants about the strenuous processes involved in assessing the loan and the kind of collateral required, Yila said:

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Yes it is a credit support intervention to the sector and it’s not a grant. It’s a loan and anytime the bank gives out a loan, there are certain conditions precedent that must be met. Because of the lockdown, they receive applications by email, we work with the banks to carry out due diligence. Typically, things that take 3, 4 weeks to do, we have cut it down to 2 days.

‘’I tell you that the biggest problem we are having is that most pharmaceutical companies or the hospitals that have submitted applications to access these funds have provided incomplete documentation. That is a source of worry because while we are in an emergency situation, due diligence must be followed.

I told you this is a loan and not a grant and the central bank has been very favorably disposed of. We tell you what we have also done, if you read the guideline, we are aware that hospitals, it takes a very long time to recoup its investment, so the facility is for a long term up to 10 years.”

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(READ MORE:CBN slashes special interest rate to 5%, directs banks to restructure loan terms)

On the interest rate, the CBN Director pointed out that the apex bank’s policy response goes beyond the 5% interest rate. He said the beneficiaries are also granted an additional moratorium of 1 year for all the over 26 intervention programmes in the portfolio of the Central Bank.  Going further, businesses that are eligible can access the N100 billion fund at 5% till March 1, 2021, he said.

Chike Olisah is a graduate of accountancy with over 15 years working experience in the financial service sector. He has worked in research and marketing departments of three top commercial banks. Chike is a senior member of the Nairametrics Editorial Team. You may contact him via his email- [email protected]

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    Business News

    FG to distribute 10 million LPG gas cylinders in 1 year

    The FG is set to inject up to 10 million gas cylinders into the market to help improve safety and deepen cooking gas utilization.

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    The Federal Government has announced plans to inject 5 to 10 million Liquefied Petroleum Gas (LPG) cylinders into the market in the next one year.

    This is to help improve safety and deepen LPG (otherwise known as cooking gas) utilization across the country.

    This disclosure was made by the Programme Manager, National LPG Expansion Implementation Plan, Mr Dayo Adeshina, at a sensitisation workshop on LPG Adoption and Implementation for Industry Stakeholders, on Wednesday in Lagos.

    According to a report from the News Agency of Nigeria (NAN), Adeshina said the National LPG Expansion Implementation Plan, domiciled in the Office of the Vice President, was committed to achieving Nigeria’s target of 5 million Metric Tonnes of LPG consumption annually by 2027.

    What the Programme Manager for LPG Expansion Implementation Plan is saying

    Adeshina said, “The Federal Government is working towards injecting five to 10 million cooking gas cylinders into the market within the next one year. We are starting the cylinder injection under the first phase in 11 pilot states and FCT, with two states from each of the geopolitical zones.

    The states are Lagos, Ogun, Bauchi, Gombe, Katsina, Sokoto, Delta, Bayelsa, Ebonyi, Enugu, Niger and the Federal Capital Territory. The cylinders will be injected through the marketers. The marketers will be responsible for the cylinders and the exchange will take place in homes and not in filling stations.

    What this means is that going forward, cylinders will not be owned by individuals but by the marketers who will ensure that they are safe for usage.’

    Adeshina pointed out that apart from household consumption, the government was trying to increase LPG usage in agriculture, transportation and manufacturing adding that this will enable the country to reduce CO2 emission by about 20% and create millions of jobs for Nigerians.

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    He said that the government had also granted waivers on importation of LPG equipment and removed Value Added Tax (VAT) on LPG in addition to investment in infrastructure.

    The President of the Nigerian Liquefied Petroleum Gas Association, Mr Nuhu Yakubu, said efforts should be made to ensure the availability, accessibility and affordability of cooking gas in the country adding that this would encourage more Nigerians to embrace gas usage in their homes with the attendant benefits to the country.

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    Mr Olalere Odusote, Lagos State Commissioner for Energy and Mineral Resources, said the population of Lagos makes it imperative for residents to adopt cleaner energy sources for cooking, transportation and power generation adding that the government was targeting the conversion of 45% of about 4 million vehicles in the state to autogas over a four-year period in partnership with marketers.

    What you should know

    • It can be recalled that the Federal Government had in November 2020, announced plans for the conversion of cars to autogas in a bid to have cheaper and cleaner energy especially with the high cost of petrol.
    • The government at different levels are pursuing cleaner energy sources for cooking, transportation and power generation.

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    Business

    JAMB bans use of email by candidates for UTME, DE registration

    JAMB has announced that candidates for the UTME and Direct Entry will no longer be required to provide their email addresses at the point of registration.

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    The Joint Admission and Matriculation Board (JAMB) has announced that candidates for the Unified Tertiary Matriculation Examination (UTME) and Direct Entry will no longer be required to provide their email addresses at the point of registration.

    The new adjustment is to protect candidates from various forms of manipulation and distortion of their personal details by some fraudulent cyber café operators.

    The Registrar of JAMB, Prof. Is-haq Oloyede, who made the disclosure while addressing newsmen at the board’s headquarters on Wednesday in Bwari, Abuja, said the change, would take effect from Thursday, April 15, 2021.

    What the JAMB Registrar is saying

    Oloyede said, “They gain access to profiles of these candidates under the pretense of creating an email address for them. Then they change and block the candidates from receiving messages from the board. They also extort them after they change their passwords.

    In view of this, the board has come up with adjustments to our operations. The first decision is that beginning from Thursday, April 15, candidates would no longer be required to provide any email address during registration from this year onwards.

    It is by going to these cyber cafes to open emails that these candidates are open to abuse and stealing of their personal data,’’ he said.

    He said that the board now had a mobile app that would allow candidates to deal directly with the board with their smartphones or via SMS to ‘55019’ code option.

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    The code option, he explained, would allow candidates to check admission status as well as all other verifications via SMS.

    He said, “Printing of examination slips, results notification or raising tickets can be done anywhere by using candidates’ registration number only. However, at the close of registration every year, we would need the email addresses of the candidates so we can have access to as many of them as possible.

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    At the conclusion of registration, candidates are expected to send their email addresses through the mobile app or text message to the 55019 code twice, for validation. This is to update their profile with JAMB as the email will no longer be used as access to their profile, but rather as a communication tool with candidates.’

    While advising candidates to guard their phones with utmost care as it was the weapon for all transactions, Oloyede said that henceforth, all JAMB owned Computer-Based Tests (CBT) centres across the country, would only allow candidates with ATM cards into its centres.

    He said that in order to cut down on the activities of fraudsters who hijack candidates to extort money from them, the centres would no longer allow candidates go outside the centres to pay for their e-pins and other cash transactions.

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    The JAMB Registrar said, “Only candidates with ATM cards will be allowed into all JAMB owned CBT centres, it can be that of their parents as long as they have the pin for the transaction.

    “Those without ATM cards can go to other privately owned CBT centres where they can pay cash to register but we will not take cash or transact outside our centres.’’

    What you should know

    Meanwhile, in a related development, JAMB had said that the board lost over N10 million in 2020 to activities of fraudsters who penetrated their payment portal for ad-hoc staff.

    The JAMB Registrar said that the money, which was meant to pay JAMB ad-hoc staff from the 2020 Unified Tertiary Matriculation Examination (UTME), was hijacked by the suspected fraudsters.

    JAMB had a few days ago confirmed the commencement of registration for the 2021 UTME/DE examinations after the initial hiccup.

    It stated that applicants must provide NIN at the point of registration with the registration by Direct Entry candidates to run concurrently with that of UTME candidates.

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