DBN To Lend N5bn To 20,000 MSME
The newly-established Development Bank of Nigeria (DBN) yesterday announced that it will lend N5 billion, long term money to over 20,000 Micro, Small and Medium Enterprises (MSMEs) in commencement of its first mandate – lending activities.
According to the bank, the loan would be disbursed through three selected Participating Financial Institutions (PFI) including Fortis Microfinance Bank, LAPO Microfinance Bank and NPF Microfinance.
Speaking at a press conference in Abuja, yesterday, the managing director, DBN, Mr. Tony Okpanachi, said the pricing of the loan is pragmatic and referenced to market rates. He also said, “DBN loan repayment tenure is flexible- up to 10 years with a moratorium period of up to 18 months and the pricing is pragmatic and reference to market rates.’’
DBN was licensed by Central Bank of Nigeria (CBN) in March this year as a wholesale development finance institution that will lend to banks for onward lending to MSMEs.
Okpanachi also said “statistics show that there are over 37 million MSMEs in Nigeria but regardless of the number, many of these businesses still struggle with access to adequate financing. With an increasing educated demography graduating from tertiary institutions, coming home to meet limited vacancies in the job market, and a corresponding number from abroad returning to Nigeria to create values, solve problems and start businesses, the time or DBN is now.
“DBN will, therefore, make sure that in addition to what other DFIs are doing, it is able to provide depth for funding of that segment. It is against this context that DBN loans will provide sustainable financing Nigerians in the MSMEs segment. Unlike other DFIs that are sector specific, DBN loans cuts across all sectors.
Okpanachi explained that past DFIs had been taken into account and that as such, the Business Model adopted by the new development finance institution would ensure its sustainability, unlike its predecessors which failed to deliver on their mandates.
He also said the nation’s economy was powered by MSMEs, though unstructured and had faced immense financing challenges, which his organization would address, head-on. “The activities within this segment account for over 50 per cent of Nigeria’s GDP. However, less than 5 per cent of these businesses have access to credit in the financial system.
“Statistics show that there are over 37 million MSMEs in Nigeria. However, regardless of the number, many of these businesses still struggle with access to adequate financing. With an increasing educated demography graduating from tertiary educational institutions, coming home to meet limited vacancies in the job market, and a corresponding number in the Diaspora returning to Nigeria to create value, solve problems and start businesses, the time for DBN is now. Existing financing options are inadequate to address the demands of the segment.”
According to the bank, the loan would be disbursed through three selected Participating Financial Institutions (PFI) including Fortis Microfinance Bank, LAPO Microfinance Bank and NPF Microfinance.
Speaking at a press conference in Abuja, yesterday, the managing director, DBN, Mr. Tony Okpanachi, said the pricing of the loan is pragmatic and referenced to market rates. He also said, “DBN loan repayment tenure is flexible- up to 10 years with a moratorium period of up to 18 months and the pricing is pragmatic and reference to market rates.’’
DBN was licensed by Central Bank of Nigeria (CBN) in March this year as a wholesale development finance institution that will lend to banks for onward lending to MSMEs.
Okpanachi also said “statistics show that there are over 37 million MSMEs in Nigeria but regardless of the number, many of these businesses still struggle with access to adequate financing. With an increasing educated demography graduating from tertiary institutions, coming home to meet limited vacancies in the job market, and a corresponding number from abroad returning to Nigeria to create values, solve problems and start businesses, the time or DBN is now.
“DBN will, therefore, make sure that in addition to what other DFIs are doing, it is able to provide depth for funding of that segment. It is against this context that DBN loans will provide sustainable financing Nigerians in the MSMEs segment. Unlike other DFIs that are sector specific, DBN loans cuts across all sectors.
Okpanachi explained that past DFIs had been taken into account and that as such, the Business Model adopted by the new development finance institution would ensure its sustainability, unlike its predecessors which failed to deliver on their mandates.
He also said the nation’s economy was powered by MSMEs, though unstructured and had faced immense financing challenges, which his organization would address, head-on. “The activities within this segment account for over 50 per cent of Nigeria’s GDP. However, less than 5 per cent of these businesses have access to credit in the financial system.
“Statistics show that there are over 37 million MSMEs in Nigeria. However, regardless of the number, many of these businesses still struggle with access to adequate financing. With an increasing educated demography graduating from tertiary educational institutions, coming home to meet limited vacancies in the job market, and a corresponding number in the Diaspora returning to Nigeria to create value, solve problems and start businesses, the time for DBN is now. Existing financing options are inadequate to address the demands of the segment.”
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