BOI disburses N57m to 13 entrepreneurs in Kogi State
In line with its mandate to boost the country’s real sector through robust financing, the Bank of Industry(BoI) has disbursed N57.24 million to 13 micro, small and medium enterprises(MSMEs) in Kogi State.
The N57m loan, disbursed under a joint agreement between Kogi State and BoI, is part of the bank’s N2 billion MSME development fund scheme, geared towards boosting business expansion and enhancing production capacity of SMEs.
BoI, which is a key development bank in the country, had on the 19th of May, 2009, entered into a pact with Kogi State government for a N2bn MSMEs development fund to drive the industrial and economic development of the state.
Already, three SMEs and nine micro enterprises from the state have benefited the sum of N130.27m from the loan scheme.
Under the MoU, Kogi State was required to pay one billion naira and this was expected to be matched in like sum by the BoI.
However, six years after the consolidation of the deal, Kogi State government has only been able to pay the first tranche of the fund which is N250million, a situation which has compelled the bank to demand the payment of the outstanding N750million.
Speaking while giving out the cheques to the beneficiaries at Lokoja recently, Rasheed Olaoluwa, BoI managing director/CEO, urged the state governor to pay the second tranche of the loan agreement so that entrepreneurs in the state would benefit from low cost funding.
Olaoluwa, who was represented at the occasion by Rasheed Olagunju, executive director, small and medium enterprises (SMEs), noted that proper funding would enable current and potential entrepreneurs in Kogi State to benefit from the bank’s ongoing efforts geared towards creating a favourable platform for MSMEs in the country.
Olagunju listed some of the new initiatives of the bank to include: creation of a full-fledged directorate in charge of SMEs, appointment of 122 business development service providers (BDSPs) at state, zonal and national levels, as well as partnership with 10 SME -friendly banks to complement the bank’s lending by providing working capital for customers at a negotiated interest rate of MPR+6 percent per annum.
He urged the state government to take advantage of the bank’s cluster-based product development initiatives.
“It is a well-known fact that Kogi State is richly endowed in agriculture, water resources and solid minerals. Some of the agricultural products include cassava, oil palm, cashew, cocoa, yam, rice and fish, among others, while the solid minerals deposits include iron ore, limestone and coal, among others,” he said.
He further said that these have created investment opportunities in agro-processing, iron and steel production, cement manufacturing, solid mineral beneficiation and water transportation, among others.
“The state also has huge tourism potential in view of its various pre-colonial relics as well as beautiful landscape and favourable weather conditions,” Olagunju observed.
“For the second phase of the programme, we would like to invite the state government to key into BoI’s cluster-based product development initiative.
“By so doing, product clusters would be identified based on the comparative advantages of the various local government areas in the state and the enterprises in such locations will be financed under the Matching Fund Scheme,” he added.
In his remarks, Idris Wada, governor of Kogi State, described the occasion as a big milestone in the administration’s effort to industrialise and generate employment while stimulating the state’s economy.
According to Wada, what constitutes impediment against the development of SMEs, particularly in the state, is inadequate supply and cost of start-up capital.
He said to address this problem faced by SMEs, the state goverment went into collaboration with the BoI and initiated this joint fund scheme to provide MSMEs entrepreneurs in the state the opportunity to access to loan.
Responding on behalf of other beneficiaries, Salami Abraham of Savidigam Enterprises, producer of poultry feeds, thanked BOI and Kogi State government for facilitating access to the loan.
He noted that the loan would enable him and his other colleagues to expand their production base and generate more employment for the teeming youths in the state.
Harrison Edeh