The Bank of Industry (BoI) has unveiled plans to leverage its existing partnership with commercial banks in Nigeria to build its risk assets from the current N600 billion to N1.2 trillion as part of efforts to improve its intervention to Small and Medium Enterprises (SMEs).The Managing Director, BoI, Olukayode Pitan, who was represented by the bank’s Executive Director, SME, Waheed Olagunju, during the African SME expo 2017, added that the bank had budgeted about N310 billion for SME development with an average of N60 billion yearly, but have not been able to process loans worth N50 billion to SMEs on account of viability.
Olagunju said the biggest problem facing SMEs is not financing, but being able to come up with a viable business model and bankable proposals, pointing out that statistics have shown that the country has never lacked quantum of money to support SMEs, rather SMEs have not been able to come up with bankable proposals.
In his words, “Some of the challenges hindering SMEs include lack of skill manpower, not able to meet the requirements of financial institutions, very vulnerable to shocks, but in spite of these challenges there some few successful SMEs in the country and this is want to showcase to Nigerians that it is possible to promote SMEs and run them viable and efficiently.At the BOI, we lend to SMEs at single digit, because we are able to mobilize resources from national and sub national sources and the tenures are quite generous and because of our branch network, we are able to work closely with the SMEs.”
Also Read: Apply for The 2017 YouWiN! Connect Enterprise Education”The project that we support are those that have the considerable developmental impact by way of job creation, projects supported by women and projects that are environmentally sustainable and those that also use a lot of local content by way of their raw materials.“We are making a lot of progress in terms of supporting SMEs. We have come up with lots of innovative schemes to reach the entire country,” he said.He, however, stated that the bank’s Non-Performing Loan ( NPL) ratio has consistently been about four per cent which is below the Central Bank of Nigeria ( CBN’s) threshold of five per cent which indicates that about 96 per cent of its loans at the bank is performing.
Do visit BOI’s website for more information on the funds
Source: The Guardian
