The Central Bank of Nigeria (CBN), Nigeria’s central banking authority, has provided an overview of the bank’s strategies that have been implemented thus far in efforts to aid in the growth of the microfinance sector of the country. These include the establishment of: the Microfinance Advisory Board (MAB) in 2005 to coordinate stakeholder interventions in microfinance; National Microfinance Policy Consultative Committee (NMFPCC) in 2006 to aid in implementing policy; Inter-Agency Technical Committee on the Implementation of the Microfinance Policy to address technical issues related to policy implementation; and the Entrepreneurship Development Centres in Lagos, Onitsha and Kano in 2008 to assist in the capacity building of microfinance institutions (MFIs).
Joe Alegieuno, Director of the Development Finance Department of CBN, stated that the main challenges facing the sector include lack of standardization in the institutional structure of MFIs, mission drift, inadequate sources of wholesale funding and the need for additional support institutions such as credit bureaus and rating agencies.
Mr Alegieuno also stated that the central bank will continue focusing on: creating awareness among investors, deposit money banks and government institutions to support the development of microfinance in a sustainable manner; reviewing microfinance policy and regulation; and overseeing the operations of MFIs.
By Medha Ravi, Research Associate
About Central Bank of Nigeria:
Central Bank of Nigeria (CBN), established in 1958, is Nigeria’s central banking authority. As defined by the 1958 Act of Parliament that created CBN, its statutory mandates are as follows: “to issue legal tender currency; to maintain external reserves; to safeguard the international value of the legal tender currency; to promote monetary stability and a sound financial system in Nigeria; and to act as banker and financial adviser to the Federal Government.” As of July 2010, CBN reports total assets of NGN 7.37 trillion (the equivalent of USD 48.6 billion).
Source and Resources:
Vanguard Article, February 8, 2011: “CBN strategises to ensure the growth of MFB sector”, http://www.vanguardngr.com/2011/02/cbn-strategises-to-ensure-the-growth-of-mfb-sector/
MicroCapital.org story, January 31, 2011, ” MICROCAPITAL BRIEF: Central Bank of Nigeria (CBN) Highlights Failings of Local Microfinance Industry, Outlines Strategy Going Forward” , https://www.microcapital.org/microcapital-brief-central-bank-of-nigeria-cbn-highlights-failings-of-local-microfinance-industry-outlines-strategy-going-forward/
MicroCapital.org story, January 27, 2011, “MICROCAPITAL BRIEF: Nigeria Federal Government Supports Central Bank of Nigeria (CBN) to Establish Microfinance Development Fund”, https://www.microcapital.org/microcapital-brief-nigeria-federal-government-supports-central-bank-of-nigeria-cbn-to-establish-microfinance-development-fund/
MicroCapital’s Microfinance Universe Profile: Central Bank of Nigeria, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Central+Bank+of+Nigeria+%28CBN%29
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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