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N10tn Required To Support MSMEs –CBN

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Nigeria requires about N10tn to effectively support the Micro, Small and Medium Enterprises financially, the Central Bank of Nigeria has said.
According to the CBN, the N220bn MSME fund that was inaugurated by former President Goodluck Jonathan last year could best be described as a drop in the ocean.
The Relationships Manager, MSME Development Finance Department, CBN, Mr. Chinedu Zeph, in an interview with our correspondent in Abuja, noted that the subsector required a massive financial outlay.
He said, “The MSMEDF is for MSMEs in Nigeria. The IMF and McKenzie did a report that we require over N9.7tn to finance the gap in this subsector. Imagine where you have N220bn to cover for N9tn that tells you that it is just a drop in the ocean. But this is a right step in the right direction.
“We are hoping that when people borrow this money, they will actually pay it back. Part of the fund has been disbursed. However, this is a going concern. If the money given to people is repaid, then it will be available for others to borrow.
“On our part, we have put a robust strategy in place and we are hoping that we will work with stakeholders and ensure that people who borrow this money actually pay back.”
When asked if the CBN would increase the amount set aside for the MSMEs considering the fact that the subsector would require more funds, he said the primary source of finance for economic activities remained the Deposit Money Banks.
Zeph, who spoke to our correspondent on the sidelines of an event organised by NECA’s Network of Entrepreneurial Women, said the inability of the DMBs to support the economy through the provision of loans made the CBN to intervene by providing different credit sources to various sectors.

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