BoI targets N1.2trn for MSMEs by 2019

The Bank of Industry ( BoI)’s support to the micro, small and medium enterprises ( MSMEs) in Nigeria will have hit N1.2 trillion by 2019.

BoI says achieving this will require leveraging on its existing partnership with commercial banks to bring its risk assets from current N600 billion to N1.2 trillion.

Olukayode Pitan, managing director, BoI, who stated this at during the African SME expo 2017 in Lagos, said the bank had budgeted about N310 billion for MSME development with an average of N60 billion per annum, but was yet to process loans worth N50 billion to small businesses on account of poor viability.

Represented by Waheed Olagunju, executive director for MSMEs at BoI, said biggest problem facing SME was not financing but viability of business model and bankable proposals, pointing out that statistics showed that the country had never lacked quantum of money to support MSMEs.

“At BoI we lend to MSMEs at single digit, because we are able to mobilise 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,” Pitan said at the event tagged, ‘Promoting SMEs for sustainable development economic growth’.

‎”The projects that we support are those that have 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,” he said, adding that ‎bank’s non-performing loan ( NPL) ratio had consistently being about four per cent ‎which was below the Central Bank of Nigeria (CBN’s) threshold of five per cent, indicating that about 96 per cent of its loans at the bank was performing.

Aisha Abubakar, minister of state for industry, trade and investment, said maintaining a broad-based MSME sector was critical for creating a business friendly environment and boosting their capacity and competitiveness at the global environment, saying that Nigeria must look inwards to identify areas where it had competitive and comparative advantage.

“The future of the SMEs in the continent is bright, but we must all do our part to make sure we achieve this,” she said.

ODINAKA ANUDU