The Bank of Industry (BoI) and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) have entered into a Memorandum of Agreement (MoA) to provide N1 billion in loans to nano and micro enterprises at single-digit interest rates. Each institution will contribute N500 million to a matching fund account managed by BoI.
Loan Details and Accessibility
The agreement allows nano enterprises to access up to N1.5 million and micro-enterprises up to N2.5 million. The loans will have a 24-month term with an annual interest rate of 7.5% for working capital loans and 5% for term loans. Applicants must provide the statements of two guarantors to secure the loan.
Significance of the Agreement
During the signing ceremony, BoI Managing Director Olasupo Olusi highlighted the challenging journey to finalizing the agreement and expressed optimism about future collaborations. Charles Odii, SMEDAN’s Director-General, commended the efforts of both organizations’ technical teams and emphasized the significance of the agreement in democratizing access to credit for small business owners in Nigeria.
Supporting Economic Growth
This initiative aims to provide critical financial support to nano and micro enterprises, which are vital for economic growth and employment in Nigeria. By offering loans at favorable terms, the partnership seeks to empower these small businesses, enhancing their capacity to contribute to the nation’s economy.
Related Government Initiatives
In a related effort to support small businesses, the federal government announced the Presidential Conditional Grant Scheme. This scheme aims to distribute N50,000 grants to one million selected applicants out of 3.6 million, supporting small businesses across Nigeria’s 774 local government areas.
For more information on the application process and eligibility criteria, Click Here
