President Goodwill Jonathan of Nigeria officially launched the Micro, Small and Medium Enterprises (MSME) Development Fund at the eighth MSME finance conference in Abuja, Nigeria, where he announced the provision of NGN 870 million (USD 5.36 million) from the NGN 220 billion (USD 1.36 billion) fund to four beneficiaries
Delta State received NGN 500 million (USD 3.08 million), while Akwa-Ibom State, Labo Microfinance Limited and Grassroots Microfinance Kano received NGN 260 million (USD 1.6 million), NGN 100 million (USD 615,000) and NGN 9.9 million (USD 61,000) respectively .
The fund is expected to provide financing for 2 million MSMEs. The funds will be distributed through financial institutions, such as microfinance institutions (MFIs), microfinance banks (MFBs), as well as through state-owned agencies .
As previously reported by MicroCapital, 60 percent of the fund, amounting to NGN 132 billion (USD 813 million), will be allocated to women-owned enterprises, while physically impaired individuals will have access to a minimum of 2 percent of the funds. The interest rates on the loans for end-users are pegged at 9 percent per year. The fund was originally planned for launch in 2012, as was reported by MicroCapital at that time.
As of November 2012, CBN reported total assets of NGN 13.8 trillion (USD 84 billion).
According to the Microfinance Information Exchange (MIX), as of 2012, Grassroots Microfinance Kano had assets of USD 791,000, a gross loan portfolio of USD 267,000 and 6,000 active borrowers with an average loan balance of USD 42. Grassroots Microfinance Kano does not offer deposits.
Labo Microfinance Limited does not report to the US-based non-profit Microfinance Information Exchange (MIX).
Simon Pfanner- Research Associate
About the Central Bank of Nigeria (CBN)
The Central Bank of Nigeria (CBN) was established in 1958 as Nigeria’s central banking authority. As defined by the 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 November 2013, CBN reports total assets of NGN 13.8 trillion (USD 84 billion).
About Grassroot Microfinance Kano
Grassroot Microfinance Kano is a microfinance bank that was established in Nigeria in 2009. It provides financial services and training for MSMEs. The bank also offers advisory services and business management coaching. According to the Microfinance Information Exchange (MIX), as of 2012, Grassroots Microfinance Kano had assets of USD 791,000, a gross loan portfolio of USD 267,000 and 6,000 active borrowers with an average loan balance of USD 42. Grassroots Microfinance Kano does not offer deposits.
Sources and Additional Resources:
 The Sun News, Jonathan disburses N860m of N220bn MSME fund
 The Nation, N220b MSMEs’ Fund for launch today
MicroCapital, March 3, 2014, Central Bank of Nigeria Announces Closure of 83 Microfinance Banks (MFBs), Denies Shutdown of Additional 600 MFBs
MicroCapital, September 6, 2013, Central Bank of Nigeria Launches $1.3b Micro, Small and Medium Enterprises Development Fund
MicroCapital, August 12, 2012, Microfinance Development Fund of Nigeria Will Seek to Increase Women’s Access to Financial Services by 15% per Annum
MicroCapital, May 18, 2012, Central Bank of Nigeria (CBN): MSME Development Fund Not for Bailing out Microfinance Banks
MicroCapital Universe Profile: Central Bank of Nigeria (CBN)
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