By Ronke Badmus

Wednesday, 24 Nov 2010

Failure on the part of the commercial banks to meet the requirements laid down for accessing the Small and Medium Enterprises fund has been responsible for the inability of operators to benefit from the remaining N70bn, a top official of the Bank of Industry told our correspondent on Tuesday.

An employee of the bank, who asked not to be named, said, “The commercial banks are yet to meet the requirements for the disbursement of the remaining SME fund.

“The qualified banks have been able to draw the amount that has been disbursed up to this moment.

According to him, all commercial banks are participating in the disbursement of the fund, but the levels of involvement are not uniform, varying and depending on the level of compliance.

He stated, “As the commercial banks are trying to meet all the security measures, the beneficiaries are also trying to meet the disbursement conditions, the fund is ready to be disbursed whenever the conditions are met,” he said.

The Assistant General Manager, Bank of Industry, Mr. Joseph Babatunde, during a programme organised by the Lagos Chamber of Commerce and Industry, on “Packaging SMEs for Accessing Finance, in Lagos, said, the interest demanded from beneficiaries was as low as seven per cent.

Speaking further on the fund, he said, “It‘s not meant for individuals but for limited liability companies.”

The Chairperson, Professional Practice Group, LCCI, Mrs. Toki Mabogunje, added that it would be advisable for borrowers to belong to professional bodies, so that they could help in accessing the loans.

According to the Director, Special Services, Manufacturers Association of Nigeria, Mr. Joseph Ifejika, ”All the banks have now joined the scheme because government has guaranteed the facility to 80 per cent of loan security in the case of default.”

He said, business associations knew their members and were supposed to authenticate their claims.

According to the President, LCCI, Mr. Femi Deru, ”We are not aware of our members that already have the facility; our aim is to make sure the money is coordinated with integrity.

“BoI, as government‘s agent should state the names of those that had benefited and the amount disbursed,” he added.

“It’s not to be disclosed, she added.

The Director-General, NACCIMA, Mr. John Isemede, said , the position of the operators was to follow up with the procedures and make sure government gave long-term grace period for pay back.

He said, “Government is not a business entity, so, they should not expect returns of the interest as soon as possible, there should be a grace period of two to five years,” he added.

 

Source: Punch