SMEDAN, Sterling Bank Earmark N5bn Loan for SMEs
The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and Sterling Bank have set aside N5 billion loan for small businesses.
The Director-General of SMEDAN, Mr Charles Odii, said this during the signing of a Memorandum of Understanding (MoU) between the parties on Wednesday in Abuja.
Odii said the funds, which would be available in two weeks, would help solve the problem of many small business owners, which is easy access to affordable finance.
”This MoU is basically to create a loan portfolio of N5 billion at a single-digit interest rate for small businesses across different sectors.
”With this loan portfolio, we can make available access to finance for close to 10,000 small businesses.
”The funds will be available in two weeks, and we are giving ourselves that time because of the pre-learning activities we need to do.
”After they have accessed the money, we will continue with some post-learning activities and work with Sterling Bank to monitor the business and the fund’s progress.
The director-general called on the media to disseminate the information to people at the grassroots who require access to funds.
”I hope you will work with us to ensure this information goes to the inner cities in the country,” he said.
Meanwhile, the Managing Director of Sterling Bank, Mr Abubakar Suleiman, said the job of the bank was to guide small businesses to position themselves to attract funding.
”So, as much as giving them low-interest rate finances is a significant part, the real gain is that if they pass through this process successfully, they can access finance anywhere.
”We are hoping that of 10,000 people that will access this fund, we will see 2,000 quickly outgrow this and then request commercial funding.
”This is because their business model will improve so quickly that they will realise that more money available through this is needed.
”So, this is like training for small businesses to enable them stabilise their current businesses and position them for expansion,” he said.
According to Suleiman, the programme will be delivered through a technological platform called Banker to ensure easy access to the fund.
”The Banker is designed to not only allow you access to this financing but to organise your business, start to keep your record and help you pay back when it is time.
”Any business that passes through this programme, even though they fail to access or meet the standard to access the fund, will leave better off.
”They will understand why they cannot access the funding, and they can go back, make changes to their business practises, and come back and access funding.
According to Suleiman, the funds will be given out for an original tenure of two years, subject to the type of business and nature of the contract.
He said: “we will give you time to use the money before you start repaying, and the funds will not be given based on collateral.
”It will be based on your business, the fact that you are a law-abiding business and citizen, you do not have a bad credit history, and the contract between us.
”We will be publishing a link which SMEDAN will announce that will allow us to build a list of interested applicants, and in two weeks, the process will have been completed to start disbursement.
“Suleiman, therefore, reiterated that the programme’s success would not just be measured by giving out the funds but by how well the businesses are doing after accessing the funds.”
While commending SMEDAN, he said, ”If Nigeria is going to grow, it will be because of small businesses.
“If the small businesses ever become competitive, it will be because of the work of SMEDAN.” Nigeria Eurobond Slumps after CBN Resumes OMO Auction
