Edo to tap CBN’s N220bn microfinance

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Edo state Government has concluded plans to tap into the Central Bank of Nigeria (CBN’s) N220 billion Micro finance Intervention Fund to help alleviate poverty in the state.

Central Bank of Nigeria
Central Bank of Nigeria

This was disclosed yesterday when the Governor, Comrade Adams Oshiomhole hosted the Governor of the Central Bank, Mallam Sanusi Lamido Sanusi, at the Government House, Benin City.

The Governor said, “Let me use this opportunity to appreciate your drive to reposition the banks so that it has come up with a number instruments that are designed to focus exclusively and address what I call the true forgotten majority.

“We also have to acknowledge the fact that those who are poor are increasing in number as a result of decades of wrong policies that have marginalized the majority and created a tiny class of extremely rich people”.

Oshiomhole said, “We recognise that for these forgotten majority, even as we create and build additional roads, if we do not take additional measures, these infrastructure themselves will not translate to the improvement of life of this majority in our rural areas and even those in our urban area”.

He said government will liaise more closely with the CBN to see how it can benefit from fund so that it can serve as a guarantor to get the funds and manage them in such a way that people across the 192 wards in the state benefit irrespective of political inclination.

Earlier, the CBN Governor, Mallam Lamido Sanusi said the CBN will continue to engage the relevant state finance ministries to avail themselves of the opportunity offered to assist small and medium scale micro-enterprises to access about N220 billion intervention fund provided by CBN.

According to him, “we do have about 30 Micro finance banks and about N220 billion micro and medium fund which is available to service medium term to lend to the poor. We have been convinced that microfinance business has become a business. Where the poorest people are paying the highest interest rate is not the way to alleviate poverty. So long as micro finance bank has equity and donor funding from commercial banks.

He said, “We are never going to get very low interest and so we have this intervention put in place and one of the ways we have tried to facilitate access is to work with state governments. So we rely on the state governments to pay us back and the state can charge reduced rate to the poor people.

He said “In the case of Kano State, we have an MoU. We are going to get the Micro finance Banks to lend at not more than 4% to the poor, macro, small and medium enterprises in the different local governments in the state.

“So the state can provide some kind of interest subsidy so that the poor can get N200,000 to N250,000 for two to two and half years of 4% interest rate especially when it is located in the areas of Skill Development, Capacity Building and other development initiatives; such as Agriculture, SME’s. We give them the training, infrastructure and provide them this finance at low interest rate.

According to him, “60% of the fund is dedicated to women”, he stressed.

The CBN Governor said he was in the state to commiserate with the Oba of Benin, His Royal Majesty Oba Erediauwa on the death of his senior Queen, Oloi Esther Erediauwa.