The Central Bank of Nigeria (CBN), in partnership with the Bankers’ Committee begins disbursement of N26 billion in Agribusiness Small and Medium Enterprises Investment Scheme (AGSMEIS) fund to the first set of beneficiaries.
The CBN Governor, Mr Godwin Emefiele at the launch of the scheme stated that the fund was organised by the Bankers Committee at its 331st meeting held on Feb. 9, 2017, in Abuja.
Mr. Emefiele noted that the objective was to ensure access to affordable funding for Micro, Small and Medium Enterprises (MSMEs), especially for people operating in the informal sector of the economy.
He recalled that as commitment to the successful practice of the scheme, all Money Deposit Banks (DMBs) voluntarily agreed to donate five per cent of their Proﬁt After Tax annually adding that their donation will be used to fund eligible projects under the scheme.
Emefiele applauded the commitment of the DMBs to support the scheme, and by the end of next year, the disbursement rate of the fund would have scale up to N60 billion.
The CBN Governor disclosed that the fund would be given to youths, who have received training on various entrepreneurship, vocational and management skills all over the country by Entrepreneurship Development Institutions and Centres.
On his part, the centres includes: the Fate Foundation, Lagos Business School, House of Tara and Thrive Agric.
Emiefele said unlike other intervention scheme where the funds were given in cash, beneficiaries under the agribusiness programme would be presented equipment that will equal the required amount based on their trade areas and the money was not free hence, beneficiaries would be monitored closely to ensure repayment.
“In Nigeria, the challenges of youth unemployment and restiveness must be confronted with strategic innovative thinking to provide sustainable solution.
“No matter how daunting the challenge may seem, I believe that with unity of purpose, we can ﬁght this scourge together.
“There is no gainsaying the fact that one of the most effective ways to tackle this scourge, is through entrepreneurship development and easy access to affordable funding.
“Yet, access to funds has been an Achilles heel on entrepreneurship development in the country today.
“A situation often credited to ﬁnancial intermediaries’ apathy to youth entrepreneurship and startups, which are usually perceived as being too risky,
lacking relevant managerial skills and not possessing,’’ he said.
Speaking, he stated that the AGSMEIS scheme would be executed under three broad components, direct, indirect and developmental components.
Under the direct component of the AGSMEIS, the CBN governor stated that beneﬁciaries could get loans to a maximum of N10 million at an interest rate of five per cent per annum and a maximum tenor of seven years.
Speaking further, he said that there was a moratorium period of 18 months on principal and six months on interest element, depending on the type of business.
The CBN governor explained that under the indirect component of the scheme beneﬁciaries could access equity and quasi-equity investments for ten years with an initial lop period of three years before denial.
He announced that the developmental component of the scheme would be used for capacity building and technical aid to support beneﬁciaries.
Emefiele stressed that the apex bank would build its developmental objectives so as to reduce the level of unemployment and create wealth that would promote growth and development of the economy.
He added that under the CBN Anchor Borrowers Programme, which was inaugurated in Nov. 2015, the bank had donated N80 billion to 358,000 small holder farmers in 34 states, cultivating eight commodities.
The focus of the event was the disbursement of materials worth N133 million to first set of 358 beneficiaries to open businesses in their chosen fields.