Banks set aside N26b for small businesses

Banks set aside N26b for small businesses

There is good news for small businesses and farmers.

They can draw from the N26 billion Agriculture and SMEs Fund, it was announced yesterday.

Union Bank Managing Director Mr Emeka Emuwa broke the news in Abuja at the end of the Bankers Committee meeting. He said the board of the Agriculture and SMEs Fund had been inaugurated.

The N26 billion in the kitty is expected to grow. The fund will finance agriculture and small businesses through equities, not loans. The fund is available for equity investment and there is no rate.

According to Emuwa, all “the banks are expected to set aside a portion of their profits, which will be made available for equity investment in agriculture and Small and Medium Enterprises.

“So, the board was inaugurated today as well as the Project Review Committee of the fund. Basically, the fund is going to start functioning and over the course of the next few weeks, there will be more communications as to how to access those funds,” Emuwa said.

For entrepreneurs, small businesses, agriculturalists, the opportunity is there for equity funding for their businesses. “The import of that to the economy at large is that those who are interested in accessing funds by looking for equity to support their agricultural ventures and SMEs should approach their banks now and apply so the banks will do a preliminary review and pass these requests on to the Project Review Committee of this fund.”

Members of the board are: managing directors of GTBank, Zenith Bank, Access Bank First Bank UBA, Director Banking Supervision at the CBN and the Director of Development Finance at the CBN.

There is also a Project Review committee, which looks at the projects. In addition to the board members, other members of the committee are FCMB, Unity Bank and Sterling Bank. The committee will pick the chairman based on the contributions of the members of the board.

Any business that is involved in agriculture or qualifies as small or medium scale enterprise are all encouraged to approach their banks with what their concerns are. It was noted at the end of the meeting that “Nigerians very often mistake the need for equity for bank loan, so you need to have sufficient equity first before you can go and get loan, go to your bank, let them know what the project is, they will do preliminary assessment to guide you to let you know whether it makes sense then send it on to the project review committee of this organization” the committeee said.

Mrs Mobola Faloye, Executive Director at Standard Chartered Bank, said that the action of the CBN to set up the investors and exporters windows in May has resulted in a N4 billion volume of trade in the forex window.

According to her, the volume of trading has gone up in the window of that market which is about N4 billion “and that is actually quite a good number and it shows that the banks have really done a lot of rallying, it shows that the banks are resilient, it shows that the banks have contributed largely in bringing in as many investors as possible to come into the market”.

Mrs Faloye noted that “there is one particular single ticket that was done on the first of August, the value of the transaction itself was $240 million so we think that things are going to be looking up and we are very hopeful that we are going in the right direction and we’ll eventually get to a stage where the rates will truly converge, which is where we want to get to and things are looking up for us.”