CBN releases N500m to 1600 micro businesses in Enugu

THE Central Bank of Nigeria (CBN) has released N500 million to the Enugu State Government to finance 1,600 micro enterprise borrowers recommended by Enugu Small and Medium Enterprise(SME) center under the state Micro, Small and Medium Enterprise Development Program (MSMEDP).

The Special Adviser to Governor Sullivan Chime on Small and Medium Scale Enterprises, Mr Anayo Agu who disclosed this in a statement said the fund represented the first tranche of over 3500 potential beneficiaries of the Enugu State-CBN Micro, Small and Medium Enterprise Development Fund (MSMEDF).

Agu said that the second tranche comprising small and medium enterprise borrowers, is expected before the end of January 2015. He added that the release of the funds was a fulfillment of the promise made by Governor Sullivan Chime to make capital available for small entrepreneurs to prosper and for rural farmers to grow.

He emphasized that the state SME Loan is open to every entrepreneur and enterprise in Enugu State irrespective of political affiliation, faith or state of origin adding that subject to the program’s guidelines, an applicant including a farmer, a cooperative society, or an NGO may borrow as little as 100,000 naira for one year for a micro venture and as much as 50 million naira for five years to build a small or medium cottage industry.

He further disclosed that the Enugu State Government paid the 3 percent cost of the 2 billion naira available to the state from CBN under the scheme and waived it to potential borrowers in order to make the soft loan very attractive to qualified applicants, .

It also approved that the participating micro finance banks earn only 6 percent as administrative charge or interest rate per annum inclusive of all bank charges for the three categories of loans under the fund.

It would be recalled that Enugu State was one of the twelve states that signed a memorandum of understanding (MOU) with CBN on July 24 2014 under the CBN 220 billion naira micro, small and medium enterprise development fund (MSMEDF).

Over the past five months, the State Special Purpose Vehicle (S-SPV) for the fund, Enugu SME Center in association with the Ministry of Human Capital Development and Poverty Alleviation, has prospected for borrowers and held outreaches in local councils, major commercial towns and religious groups in Enugu State.

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