In its fulfillment of overcoming the adverse economic impacts of COVID-19 pandemic on the Nigerian economy, especially families and small businesses, the Central Bank of Nigeria (CBN) has commenced the disbursement of N50 Billion loan to households and Micro, Small and Medium Enterprises (MSMEs) who were adversely affected by the pandemic.
With this stimulus package ‘Targeted Credit Facility’ (TCF), aimed at jump starting the Nigerian economy, households could get up to N3 Million while MSMEs could assess a maximum of N25 Million. To expedite the loan process, the CBN has waived the conditional guarantor requirement, and the loan is being disbursed through subsidiary of CBN, NIRSAL Micro Finance Bank. Details of the loan process is at NIRSAL website, nmfb.com.ng./
Speaking during the flagging off of the loan disbursement to beneficiaries, Mr Abubakar Kure, the Managing Director of NIRSAL Microfinance Bank, stated that, “This initiative is to provide liquidity and allow the economy to normalize. Businesses are hurt. People are hurt. People are no longer staying on jobs”.
The target groups comprising households and businesses affected by the pandemic might seem like the greater percentage of Nigerians. However, the requirements for accessing the loan which includes ‘verifiable evidence’ of livelihood and existing businesses adversely impacted by COVID-19, as well as the collateral requirements, will serve to limit the number of the loan applicants.
Financial experts, however, suggest that since the loan is termed with initial fixed interest rate of five percent, the CBN could be more compassionate and waive the conditional collateral in addition to the waiver on the guarantor requirement. This they say will make the loan more accessible and help alleviate the economic burden faced by businesses and families during this pandemic.