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Business
AfDB, Afreximbank and FCI partner to support emerging factoring firms in Africa
AfDB, Afreximbank & FCI are partnering to launch a major Grant to support the capacity building of factoring firms in Africa.
The African Export-Import Bank (Afreximbank) in collaboration with African Development Bank (AfDB) and FCI (Formerly Factors Chain International) is creating a special purpose grant that would support the capacity building of emerging factoring firms in Africa that would assist the SMEs across Africa.
This was disclosed in a press statement released by Afreximbank which stated that the grant will be mobilized by the African Private Sector Assistance (FAPA), a bi-lateral, multi-donor fund that would allow the FCI and Afreximbank to increase its relevance in growing the factoring market in Africa.
According to the Press Statement
- The Grant includes consultancy services to advise the start-up and establishment of factoring companies in legal, operations, risk, administration and technology.
- It will provide advisory and mentoring services to entrepreneurs, finance companies and commercial banks. It will help to organize conferences and workshops on the continent as well as to train and sensitize users and government officials.
- It will offer scholarships into the FCI Academy’s online courses to various stakeholders. It also includes funding for entrance into the FCI-Afreximbank “Certificate of Finance in International Trade” (COFIT) programme.
- Attendees from Africa will be able to participate in this one-year highly specialized combined virtual online and physical in-person education experience at the headquarters of Afreximbank, which is accredited, backed and certified by the University of Malta.
What they are saying
According to Mrs. Kanayo Awani, Managing Director of Afreximbank’s Intra-African Trade Initiative and Chairperson of the FCI Africa Chapter,
- “The challenges faced in accessing finance has greatly impacted the ability of many SMEs in Africa to grow and to pursue business opportunities. Afreximbank sees factoring as an important solution to bridge the funding gap facing SMEs, and the FAPA Grant will complement our strategy to grow intra-African trade and facilitate greater SME contribution to regional and global supply chains.
- “The FAPA Grant will also reinforce and grow the availability of effective factoring across the continent and increase awareness and knowledge of the product in Africa. We look forward to a successful collaboration with AfDB and FCI in the implementation of the Grant.”
According to Mr. Bleming Nekati, Chief Trade Finance Officer at the African Development Bank,
- “Small businesses in Africa face major constraints in accessing finance, not only due to a general underdevelopment of the financial sector but also due to other constraints, such as the lack of information and awareness about what factoring is and its benefits as an alternative trade finance instrument.
- “Given the multisectoral impact of trade finance in general, and factoring in particular, by ultimately benefitting SMEs within sectors such as agriculture, light manufacturing, telecoms, and power generation; this initiative is consistent with our strategic focus as outlined in the Bank’s High 5s, namely: Integrate Africa, Feed Africa, Light Up & Power Africa, Industrialize Africa and Improve the quality of life for the people of Africa. We are, therefore, extremely proud and excited to partner with Afreximbank and FCI in efforts to help develop and grow the factoring industry in Africa.”
According to Mr. Peter Mulroy, FCI Secretary-General,
- “We are delighted to partner with the African Development Bank and AfreximBank on this very unique journey to help increase awareness, educate the future generation of the factoring industry in Africa, and provide financial support to users – whether they be small entrepreneurial investors, existing finance houses, boutique trade finance shops, commercial banks, legislature, central bankers, ministry officials and regulators; all to support the development of a strong, safe, and healthy future for the industry. We look forward to launching together with our partners this very exciting initiative.”
What you should know
- Nairametrics had recently reported that the African Export-Import Bank (Afreximbank) is strongly in support of factoring as a viable alternative financing instrument for supporting Small and Medium-sized Enterprises (SMEs) in the African continent.
- Factoring has become necessary as a number of traditional commercial banks are not lending and especially at a time when trading is set to commence under the African Continental Free Trade Area (AfCFTA).
- Just on 4 January, FCI announced the appointment of a new Regional Manager for Africa, who is to work alongside Afreximbank’s Factoring Working Group to support the deployment of the Grant.
- FCI (formerly known as Factors Chain International) is the Global Representative Body for Factoring and Financing of Open Account Domestic and International Trade Receivables.
- FCI has about 400 member companies in 90 countries – a unique network for cooperation in cross-border factoring.
Business
FEC approves 65 years retirement age for teachers, okays special allowances
The FEC has approved an increase in the retirement age of teachers across the country.
The Federal Executive Council (FEC) has approved an increase in the retirement age of teachers across the country from 60 to 65 years or 40 years in service as against 35 in the new Harmonized Retirement Age for Teachers Bill, 2021.
The bill seeks to give legal backing to new measures by the Buhari administration to enhance the teaching profession in the country.
This disclosure was made by the Minister of Education, Adamu Adamu while briefing State House correspondents at the end of the first Council meeting of the year, which was presided over by President Muhammadu Buhari in Abuja on Wednesday.
The minister said that some of the highlights of the Harmonized Retirement Age bill which has been forwarded to the National Assembly for consideration and approval include the introduction of bursary award, special rural posting allowances, science teachers’ allowance and other measures to boost the performance of the teachers and attract the best brains.
What the Minister for Education is saying
Adamu said the government decided to increase the years as a reward for teachers’ dedication to duty and also to attract more people to the profession.
He said:
- “This memo that was approved for the Ministry of Education is a giant step towards what we set out to do last year, with the approval of some special packages for teachers by the President.
- “So, at the meeting today, Council approved that a bill which will be called harmonized Retirement Age for Teachers in Nigeria Bill 2020 be sent to the National Assembly for enactment into law so that all the promises made by the president and all the approvals he had given to me will now begin to be put into effect because this is the legal backing that is required for it.
- “The essence of the bill actually is to give legal backing for the approval of a new retirement age of 65 for teachers and then the service period being extended to 40 years.
- “The intention is to attract the best brains to the teaching profession and for that, the president approved the reintroduction of bursary awards, improving teacher quality, funding teaching practice from TETFUND, the enhanced entry point for teachers.’’
What this means
- When passed and signed into law, the implementation of the Harmonized Retirement Age for teachers means the retirement age of teachers has been extended to 65 years as against the existing 60 years or 40 years of service as against 35 years that currently apply, whichever of the 2 that comes earlier.
- The bill will help to motivate the teachers across the country and attract the best brains in the profession which had been bedevilled with poor condition of service for the teachers and poor funding.
Business
Covid-19: FG launches Rapid Response Register (RRR) for urban poor affected by pandemic
The FG has launched a Rapid Response Register (RRR) for urban poor affected by the COVID-19 pandemic.
The Federal Government of Nigeria launched the COVID-19 Rapid Response Register (RRR), an emergency intervention database, for the urban poor made poorer by the pandemic.
This programme was launched by the Vice President, Yemi Osinbajo on Tuesday.
The scheme would see the FG share N5000 monthly to households as it says 1 million households would benefit from the scheme.
The Vice President’s Senior Special Assistant on Media & Publicity, Laolu Akanda said: “Osinbajo today launched a technology-based Rapid Response Register which identifies urban poor people who in the next 6 months willl receive N5000 monthly. In all 1 million households will benefit from this especially cash transfer being implemented by the Humanitarian Affairs Ministry.”
While inaugurating the COVID-19 Rapid Response Registration (RRR) Cash Transfer Project, the Vice President said:
“As of Dec. 31, 2020, we have identified and registered about 24.3 million poor and vulnerable individuals into the National Social Register; equivalent to about 5.7 million households.
“Through this project, we are currently injecting about N10billion directly into the hands of about two million poor and vulnerable households every month.
“This social protection method of targeting is the first strategy to be developed and tested in the Sub-Saharan Africa region and Nigeria will be the first country for its implementation.
“With the RRR, which uses a wholly technology-based approach, we are primed to achieve an end-to-end digital foot-print in cash transfers for the urban poor.”
The Vice President added that the implementation of the scheme would enable Nigeria to achieve its financial inclusion policy under the Enhancing Financial Innovation and Access programme (EFInA).
What you should know
- Nairametrics reported last week that the Federal Government announced that it would inaugurate a COVID-19 Rapid Response Register (RRR), which would be a health emergency response for the poor living in urban centers that have been affected by the pandemic.
- The register which is being built by NASSCO is an expansion of the existing National Social Safety Nets Project (NASSP). It targets small business owners, street vendors, petty traders, Small and Medium Enterprises (SMEs), and service providers.
Business
FIRS hits 98% of target as it collects N4.95 trillion for 2020 fiscal year
FIRS has announced that it generated N4,952,243,711,728.37 as tax revenue in the 2020 fiscal year.
The Federal Inland Revenue Service (FIRS) has announced that it generated N4,952,243,711,728.37 as tax revenue in the 2020 fiscal year.
This is about 98% of the tax target of N5.076 trillion that was set for the FIRS by the Federal Government, despite the economic challenges of 2020 caused by record low oil prices and the outbreak of the coronavirus pandemic.
This disclosure was contained in a statement which was issued by the Director of Communications, FIRS, Mr Abdullahi Ahmad, on Tuesday in Abuja.
According to a report from the News Agency of Nigeria (NAN), Ahmad in his statement quoted the Executive Chairman of the Service, Mr Muhammad Nami, as saying that this performance was remarkable, considering the devastating impact of Covid-19 on the Nigerian economy.
He pointed out that some of the factors that negatively affected the operations of FIRS last year include, record low oil crude oil prices globally, business disruptions and lootings during the violent #EndSARS protests and the generous tax waivers granted to businesses to ease the impact of the Covid-19 lockdown.
He also said that additional tax exemptions granted to small businesses in the 2019 Finance Act and insecurity in some parts of the country were other factors that affected collections.
In the analysis of the significance of the 2020 performance, the FIRS Chairman said that the oil revenue which used to contribute over 50% in tax returns through the Petroleum Profits Tax in previous years, accounted for only 30.6% of the tax revenue generated in 2020 due to low oil prices.
He also pointed out that the non-oil tax collection, which was 109% in 2020, was 9% higher than the previous year and attributed these achievements to many reforms initiated by the board and management of FIRS under his leadership.
He said, “The conscientious taxpayers in the country and dedicated members of staff of the FIRS nationwide for their support and devotion to work made this performance possible despite the numerous obstacles encountered in 2020.
“The FIRS is optimistic that this current fiscal year will be better than in 2020. We shall perform well, given that our service reforms are expected to yield greater dividends, especially as different parts of tax administration are being automated.’’
“We are also optimistic that exploration activities will improve in the oil sector and increase the prospect of higher tax revenue from the sector.
“Similarly, the ongoing reforms together with increased stakeholder collaborations will brighten the prospect of improved voluntary compliance and consequently higher tax revenue generation for the country this year and beyond.’’
What this means
- This means that despite the unprecedented crisis in the oil sector due to the impact of the coronavirus pandemic, the non-oil sector performed beyond expectation in terms of tax collection.
- This was made possible by incentives granted by the revenue agency to encourage taxpayers to voluntarily fulfil their obligations towards the government in addition to some reforms to aid efficient and effective tax collections.
- Some of these reforms include the deployment of technology for tax operations, capacity building for staff, improved welfare for staff and so on.
