Months after President Goodluck Jonathan launched the disbursement of the N220 billion Micro, Small and Medium Enterprises Development Fund (MSMEDF) initiated by the Central Bank of Nigeria (CBN), members of the Organised Private Sector, (OPS), are yet to access it; Ayodele Samuel reports.
For members of the Organised Private Sector (OPS), accessing the recently launched N220 billion Micro, Small and Medium Enterprises Development Fund (MSMEDF) initiated by the Central Bank of Nigeria (CBN) is a big nightmare.
During the flag-off of disbursement of the Fund in Abuja, President Goodluck Jonathan rekindled optimism among owners of such enterprises that their days of frustrations may be over soon.
However, today, several members of the OPS who attempted accessing the fund said they were faced with procedural frustration.
President Jonathan also explained that, with the flag-off, he was equally kick-starting the disbursement of the fund to participating financial institutions and state governments, for onward lending to MSMEs across the country.
However, the Director-General of Small and Medium Enterprise Development Agency (SMEDAN) Mr. Umar Bature Masari, had openly lamented the inability of its over 55 thousand registered cooperative society (comprising over 800 thousand individuals) to access the MSME intervention funds through the Bank of Industry (BoI) owing to the bottlenecks that have made it impossible for the BoI to access the funds from the CBN.
The SMEDAN, DG had called on the CBN to soften the condition for assessing the MSME facility to enable Nigerians benefited from the fund.
Also, the Onitsha Chamber of Commerce while decrying the inability of OPS to access the intervention fund, attributed this to many banks' lack of interest in the programme.
According to the President of the chamber, Tim Anosike, "The OPS is still having difficulties in accessing the Federal Government's N220b MSME fund because the three percent CBN-approved interest rate for them is too small".
He said that the problems facing the sector include the complicated procedures in accessing the fund and lack of interest of many banks in the programme.
"The current N220 billion MSME intervention fund by the CBN is a laudable initiative.
"This Chamber believes that if the fund could be made available for the target groups, then the national economy must have received a significant boost at the end of the day; more so, as 60 percent of it goes to women entrepreneurs; but our fears remain those of complicated procedures," he lamented.
According to him, the obvious lack of interest by many banks to be part of the exercise is due to the fact that the three percent CBN-approved interest rate for them is too small.
However, Managing Director of Asha Microfinance Bank, Ikeja, Lagos, Aminu Bhuiya, said there are no stringent rules in accessing the loan if the rules dictated by regulators are followed, "but most of them will prefer not to access the loan than exposing their weakness".
Bhuiya however noted that the medium through which the funds are to be channeled are not healthy. "These obstacles are some of the reasons why many operators cannot access the loan" he said.
The present initiative is not the first of such efforts introduced to empower the private sector for efficiency. There had been several of such interventions in the past, most of which failed to achieve their desired goals of increased efficiency and job creation. On the list of these past efforts are the Power and Airlines Intervention Fund (PAIF) meant to help address the constraints of electricity; Small and Medium Enterprises Credit Guarantee Scheme (SMECGS); SME Refinancing and Restructuring Facility (RRF); Youth Empowerment Programme (Entrepreneurship Development Centres (EDCs)) and NYSC Venture Prize Competition), Commercial Agricultural Credit Scheme (CACS), Agricultural Credit Guarantee Scheme (ACGS), among others.
However the impact of these intervention initiatives were never reasonably felt, OPS members are afraid that the N200bn fund might go the same way.
Anosike advised the CBN to guard against anything that could truncate this laudable objective, so that the MSMEs would get the lifeline.