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Home Opinions Blurb

Nigerians now seeing CBN Intervention funds as audio money

Lawretta Egba by Lawretta Egba
November 4, 2021
in Blurb, Spotlight
Nigerians now seeing CBN Intervention funds as audio money
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When the COVID-19 pandemic came with all her fangs, world leaders swung into action with the creation of intervention funds and palliatives to ease the burden of the average citizen.

In Nigeria, asides the palliatives of foodstuff given by state and federal governments alike, drums were rolled when the Central Bank of Nigeria disclosed its support for critical sectors of the economy.  

The apex bank first initiated a fund of N50 billion soft loan to small businesses. The N50 billion Targeted Credit Facility (TCF) was to serve as a stimulus package to support households and micro, small and medium enterprises (MSMEs) whose economic activities have been significantly disrupted by the COVID-19 pandemic.

The financial institution for the scheme is NIRSAL Microfinance Bank (NMFB) and the interest rate under the intervention was fixed at 5% per annum (all-inclusive) up to February 28, 2021, and thereafter, the interest on the facility shall revert to 9% per annum (all-inclusive) as from March 1, 2021. 

Next, it increased its intervention by another N100 billion in loans to support health authorities to ensure laboratories, researchers, and innovators work with global scientists to patent and produce vaccines and test kits in Nigeria so as to prepare for possible crisis ahead.

Finally, it increased its intervention in boosting local manufacturing and import substitution by another N1 trillion across all critical sectors of the economy. 

Despite the rhetoric, majority of Nigerians are still wary of the so called N1 trillion intervention fund. The CBN is yet to issue any policy guideline for its implementation and failed to provide further details in its monetary policy committee meeting held last week. This has led many to start to view these promises as “audio money” a social media term for financial promises that are never fulfilled. 

READ ALSO: CBN releases new capital base, sanctions for Microfinance Banks in new draft guidelines

The journey thus far 

The Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL) Microfinance bank, on behalf of the Central Bank of Nigeria (CBN), has started the disbursement of the N50 billion Targeted Credit Facility (TCF) to the beneficiaries. As at April, it noted that it had received over 80,000 applications for the facility, out of which 40,000 of them were households.  

As expected with such funding, the sentiments have been both positive and negative. While some have said they have gotten the funds, others have complained incessantly about the various challenges encountered in the process of obtaining or applying for the loans. Pockets of tweets revealed the general struggles of obtaining the loans. Several applicants have complained about not being able to open accounts or access the facilities and others have complained about making inquiries without responses. 

Bola Murtala explained to Nairametrics that “I applied online around the 30th of April, filled out the forms, and submitted. After I got a reply in my email that my application has been received, but then I haven’t heard back from them since then. I wouldn’t know what’s going on but I have seen people who say they got an approval. How far it is true, I wouldn’t know.” 

READ MORE: COVID-19: Nigeria needs $50 billion to survive an impending recession

Another applicant, Okey Adinde, said “I applied and received a message telling me that I will be contacted if there was any other document required and if I didn’t send that document after 72 hours after the mail, my application will be declined. Since then, I have not heard from them.” 

One Twitter user also complained about being asked to tender collaterals even though the loans do not require any.  

Clearly, the program is not without its own hiccups. During an interview with Channels TV, the Managing Director of NIRSAL Microfinance Bank Plc, Abubakar Kure, explained that the nationwide lockdown and restrictions had a major challenge to the smooth processing of the facility. Yet, on the company’s website, it claims to have disbursed over N25 billion and going. 

However, there are positive comments too: 

Fidelis Ayebae, the chief executive officer of Fidson Healthcare Plc. explained that his company had received N2.5 billion from the central bank’s coronavirus intervention fund. Dollar scarcity and a weakening naira had heightened the inflation on inputs of many pharmaceutical firms in the country. 

“You now have a situation where nobody is holding letters of credit, no manufacturer is getting anything from their suppliers abroad because even the ones that we owe, we are not able to pay,” said Ayebae, who also heads the 180-member pharmaceutical group of Nigeria’s manufacturers association.

In truth, sentiments on the program is still burdened with the same lack of faith and trust in systemic leadership and Nigerians have had their fair share of disappointments. Even as the CBN and NIRSAL have set off on a good note by augmenting businesses and individuals in key areas to withstand the impact of the pandemic, the need for transparency cannot be overemphasized.

By employing tighter systems, particularly in the area of customer relations, while also clearly disclosing its activities, the system will assuage the fears of Nigerians whose faiths have been battered by deceptive leadership amongst others.

It is only then that they’ll know for sure that the days of audio money are over and that its leaders can be trusted. 

 

Related

Tags: Bottom LineCBNCentral Bank of NigeriaNIRSAL Microfinance Bank

Comments 5

  1. Blessing Adikpe says:
    June 21, 2020 at 2:42 pm

    I think the CBN covid 19 loan in audio money indid, I gut a text on 3rd of June that my application for the loan was successful, after filling all the nesesari information through a link they sent me they told me I’ll get the money in 48 hours over two week now they money has has not been sent. The phone numbers they gave too has never gone through for one second. What most have been the reason for their actions?

    Reply
  2. Iheoma Sophia Nwachukwu says:
    June 25, 2020 at 2:30 pm

    I was trained and given a Start-Up Loan by NDE in 2006 as an ICT/Computer Graphic Service Operator. When AGSMEIS Loan came up, NDE also invited me to apply for it. So, on December, 2019, I applied through AGSMEIS website after opening a savings account with them, I submitted my form and I got a reply “successful”. I proceeded for the training, and after that we were asked to write a business plan, of which I did that, I submitted it, and I received “successful” as a reply from CBN, but am surprise, I’ve been parading the bank to find out from them what is still holding my name, because I’ve seen many people who have benefitted the AGSMEIS Loan, but as am writing this letter to you, nothing has been heard from NIRSAL.

    Reply
  3. okwuchi anwuli says:
    June 30, 2020 at 6:08 pm

    I have been trying to access the site for the covid loan to no avail. PLS is there a deadline already. We are much that still want to apply

    Reply
    • Anonymous says:
      November 9, 2020 at 6:09 pm

      Hello

      Reply
  4. Pharm Jumoke says:
    July 1, 2020 at 2:55 pm

    Please, can you send me the link
    So that I can apply

    Reply

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