Through the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), the Federal Government has made a N500 million grant accessible to just six Small and Medium Enterprises (SMEs).
Many operators of small and medium-sized enterprises were not aware that a Nigerian bank had filed a N500 million loan portfolio to support small firms several months ago.
While signing a Memorandum of Understanding (MoU) with Sterling Bank on Wednesday, Charles Odii, the Director General of SMEDAN, revealed this information. The purpose of the MoU is to provide N5 billion in single-digit APR loans to small enterprises across the nation.
Read Also: Hotel staff and businessmen are detained in Abuja, Lagos, for drug trafficking
“We had a situation where we had some funds in one of the banks; I won’t name the bank,” he stated. It was almost 500 million Naira. And just how many individuals used that money? Six individuals. Six people had access to N500 million out of the total.
Odii attributed the majority of SMEs’ incapacity to utilise the money to inadequate information dissemination.
He remarked, “Everyone I asked, small business owners, even in FCT, said they were unaware that the funding was available.”
“The MoU is to create a loan portfolio of N5 billion at a single digit interest rate for small businesses across different sectors,” said the new SMEDAN CEO, commenting on the agreement with Sterling Bank.
“With the loan available, we can provide nearly 10,000 businesses with access to financing.”
Odii asserted that the agency would do everything within its power to guarantee that small firms nationwide had simple access to capital, citing the indispensability of small enterprises having access to capital.
“As an organisation, our goal is to first facilitate access to financing, as we recognise that it is highly expensive and scarce in this region of the world,” he stated.
The government has already implemented a number of access to finance intervention projects for SMEs, according to Mr. Abubakar Suleiman, Managing Director of Sterling Bank, who also stated that the bank’s participation in the new plan will be revolutionary.
In addition to giving small firms access to financing, he said the bank was considering a relationship with SMEDAN that would guarantee the massive expansion of numerous SMEs into larger enterprises.
It is our responsibility to assist them on their path to become a financially viable organisation. As a result, even though we will offer low interest rate financing, the truth is that if you successfully complete the process, you will be able to obtain financing anyplace since you will be able to satisfy the necessary and straightforward fundamental criteria, according to the CEO of Sterling Bank.
Speaking further, Suleiman stated that information on the bank’s and SMEDAN’s financing scheme for SMEs will be available online. He also mentioned that the loan period would be between six months and two years in maximum.
