NDIC urges microfinance banks to access N220bn MSME fund

The Nigeria Deposit Insurance Corporation (NDIC) has appealed to Microfinance Banks (MFBs) to access the N220 billion Micro Small and Medium Enterprise (MSME) Fund for the benefit of their customers.

It’s Managing Director, Mr Umaru Ibrahim, made the appeal in Benin during the 2nd Annual Conference on Microfinance and Enterprise Development organised by the LAPO Institute for Microfinance and Enterprise Development on Wednesday.

Ibrahim said that the N220 billion MSME fund was an intervention fund provided by the Central Bank of Nigeria (CBN) to boost small and medium businesses in the country.

He said that access of the MSME fund by MFBs would go a long way to reducing scarcity of loanable funds which had been a major challenge confronting MFBs in the country.

The NDIC boss, who was represented by a Director in the Corporation, Mr Joshua Etopidiok, also urged MFBs to lower their lending rates to attract more customers.

He said that the role of MFBs in poverty reduction could not be over emphasised, saying that high lending rates would discourage many customers from accessing their loans.

He also called on operators of MFBs to be innovative and be prudent in their operations for the benefits of their depositors and all stakeholders.

The NDIC boss said that the corporation was committed to growth and development of MFBs in the country through its capacity building support programmes.

He said that the corporation had organised sensitization workshops on Enterprise Risk Management for 400 MFBs Operators in the country.

He also said that the corporation, in collaboration with CBN, conducted on-site examinations for MFBs to ensure safety and soundness of the sub-sector.

Ibrahim listed challenges confronting MFBs to include poor asset quality, lack of micro finance knowledge and experience, poor corporate governance as well as high operating cost.

Other challenges, he said, were scarcity of loanable funds, inadequate/lack of rendition of returns to supervisors and limited outreach as well as low literacy level.

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