The Central Bank of Nigeria (CBN) has approved N50billion intervention fund for the textile industry, which will be administered by the Bank of Industry (BoI) at 4.5 percent interest rate.
CBN made the announcement in a release titled “Non-Interest Guidelines for Intervention in the Textile Sector”.Director, Financial Policy and Regulation Department, Kelvin Amugo, signed the statement.
CBN said the funds would be used to resuscitate the ailing textile sector, restructure facilities and provide further facilities for textile firms with genuine need for intervention.
The maximum financial amount is N2billion for a single obligor for new facilities and N1billion for refinancing.
The one-off intervention will terminate by December 31, 2025.
CBN Governor, Godwin Emefiele, had met with textile mill owners on how to revive the ailing sub-sector.
They were asked to explain the status of their BoI Cotton Textile and Garment (CTG) Loans, stating their outstanding balances, tenure, interest rate, interest payment and the assistance being sought from CBN.
Activities to be covered are operations in the CTG value chain include cotton ginning (lint production), spinning (yarn production), textile mills, integrated garment factories (for military, para-military and schools and other uniformed institutions).
Those allowed to participate are textile companies with an existing facility in the books of BoI under the CTG scheme, and those with existing facilities in Deposit Money Banks/Non-Interest Financial Institutions (NIFIs).
Companies not participating under the Small Enterprises/Restructuring/Refinancing Fund (RRF) are qualified for this intervention, while projects financed before June 2009 (inception of the BoI CTG Loan) shall not be eligible to participate.